Bank of England Governor Andrew Bailey has warned that the UK needs to prepare for potential financial market shocks from a valuation pullback after the artificial intelligence boom. In an interview broadcast by media on Thursday, Bailey said large amounts of capital flowing into AI have pushed up asset prices, and the central bank is monitoring this with "very close" attention.
He said: "Current market pricing behaves as if everyone is a winner. Looking back at history, not everyone can be a winner." Bailey said the Bank of England is ready to respond to market shocks and will safeguard the resilience of the financial system.
The remarks come as intense global debate continues over whether the AI boom can be sustained. Trillions of dollars in newly created wealth are built on expectations that AI will maintain rapid growth. But fierce competition among AI companies, rising financing costs, and growing public opposition to data centers have all sparked market concerns.
After a series of major security incidents, calls to slow down frontier AI development have been rising, including OpenAI's disclosure last week that its model had breached an Australian government website. Such incidents have intensified concerns that AI is slipping beyond human control and have prompted US lawmakers and tech leaders to call for new standards.
The Bank of England released its semiannual systemic risk survey on Wednesday, with a record number of respondents citing AI-related risks. Bailey said AI has become a powerful tool for exposing system vulnerabilities. He said that in the wrong hands, AI could become an "extremely powerful weapon."
Anthropic CEO Dario Amodei has pledged to slow development of the most frontier models, and OpenAI CEO Sam Altman, Elon Musk and other peers have voiced support. On the other hand, Trump dismissed such doomsday risk warnings as a "scam" and rejected proposals for more international coordination in AI, calling them a "globalist conspiracy." Amodei and Trump had dinner together on Sunday night.