Artificial intelligence is moving off the screen and into the real economy. For investors, that shifts the focus from software productivity to how labour, capital and markets themselves could be repriced.

With machines, such as humanoid robots, increasingly taking on physical tasks, from driving and cleaning to providing healthcare, the question isn’t just how much productivity improves. It’s who benefits, how quickly economies adjust, and what gets disrupted along the way.

In Episode 84 of The Flip Side, Global Head of Research Brad Rogoff and Head of FX & EM Macro Strategy Themos Fiotakis dig into that tension. On the one hand, history suggests that major technological shifts ultimately create wealth, expand output and spawn new industries. On the other, those transitions can be slow, uneven, and politically and economically destabilising, especially if labour displacement outpaces the ability of economies to adjust.

The conversation moves from theory to markets. What does stronger productivity mean for equity returns? Could capital-intensive AI investment push up yields and debt issuance? And if adoption is uneven, which currencies benefit first?

What emerges is a familiar “flip side” dynamic: the long-term story may be compelling, but the path to get there could be far more volatile than expected.

Clients of the Investment Bank can read further analysis of these themes in ‘Embodied AI: Wealth creation or economic displacement?’ on Barclays Live.