Analysis
August 27, 2026
Steel Summit: Dr. Basu sees resilient US growth supporting steel demand
Written by Laura Miller
Dr. Anirban Basu, chairman and CEO of Sage Policy Group, expects the US economy to grow through 2026, with limited recession risk.
“I think this will be a year of economic growth,” the economist said in his Sylvester Stallone-themed keynote discussion at the SMU Steel Summit this week in Atlanta. He estimates real GDP growth of about 2.0-2.3%.
The outlook supports demand in selected steel-consuming sectors, Basu said. Data centers, electricity generation, and transmission projects, driven by rapid spending on AI infrastructure, are expected to remain key sources of construction activity.
Basu highlighted the importance of those sectors to steel consumption. He described data centers and energy projects as “these two segments of construction, which use about 40% of American steel.” This could support activity even as other parts of construction remain subdued.
High interest rates remain a constraint for housing, commercial real estate, and manufacturing. Higher material costs, labor shortages, and weak conditions in offices, multifamily buildings, and warehouses also weigh on broader construction demand.
Basu said the main downside risk is a sharp decline in equity markets. He also cited persistent inflation, policy uncertainty, and geopolitical tensions. His central case remains for growth, but he sees the expansion as uneven and dependent on AI investment, strong corporate earnings, and higher-income consumer spending. As Basu put it, “Silicon Valley is fine. Wall Street is fine. … Parts of the Main Street economy are a little rockier.” He pointed to surges in loan delinquencies, home price appreciation, a housing shortage, and high office vacancy rates.
