AI construction continues to soar

ACA’s summer economic forecast predicts no relief from high inflation and elevated interest rates in the short-term for construction, but recession unlikely.

The American Cement Association’s (ACA) Market Intelligence team expects inflation and interest rates to remain elevated throughout 2026—not helping construction in the short-term. The prediction is included in ACA’s Summer Economic Forecast, released today. Continuing uncertainty around the Iran War’s timeline is largely to blame.   

According to ACA’s report, higher costs will continue to weigh on construction projects, but they are not expected to cause another negative year in 2027. As uncertainty eases next year, the Federal Reserve is likely to make one rate cut, prompted by inflation data moving in the right direction. Although the cut is not expected to significantly affect the construction season, it should mark the start of a recovery in cement volumes.

ACA forecasts slight growth of 0.4% in 2027, led by a nascent rebound in single-family construction. In 2028, a more substantial gain of 2.6% is expected as all three construction sectors will contribute to growth.

Data centers, on the other hand, have grown considerably over the past 12 months, now accounting for 55% of office construction spending, up from 40% in 2025.  ACA has upwardly adjusted the outlook for this type of construction, expecting 625,000 metric tons to 725,000 metric tons of cement to be used in data center expansion annually between 2026 and 2028.

“Despite high inflation and elevated interest rates, consumer spending and the labor market continue to show resilience,” said Brian Schmidt, ACA’s Senior Director of Economic Policy and Analytics.

“What’s in question is whether a fragile economy can stay the course. The stock market has been positive overall for top-earning households this year, but there are many downside risks to consider, such as rising delinquencies and defaults among the lower end of the income spectrum.”

Please see the summary of the Summer Forecast. To order ACA’s complete 2026 Summer Forecast, please contact Wilena Tate, ACA Market Intelligence Coordinator, at Wtate@cement.org