Lagarde warns of massive European capital flows into US AI, calls for building domestic computing power to safeguard technological sovereignty.

ECB President Lagarde delivered a speech in Vienna on September 14, titled "A New Capital Age: Growth, Sovereignty and Artificial Intelligence." She noted that euro area households hold about 440 billion euros in US tech assets, with European capital flowing heavily into US AI. AI penetration in Europe exceeds half, but digital investment lags behind the United States. The spread of AI is expected to boost productivity by up to 4% within a decade, easing the fiscal pressure brought by aging populations. Lagarde warned that simply importing AI carries risks of data dependence, supply disruptions, and losing the technological high ground. Europe needs to build its own computing power, with up to 600 billion euros required to close the gap, and develop homegrown AI models. She said European tech innovation financing relies excessively on banks, and that Europe does not lack savings but lacks channels to direct funds, and flagged bubble risks in US AI buildout.