Bank of England Warns AI Agents Could Disrupt Markets, Reviews Regulatory Frameworks

Bank of England Deputy Governor Sarah Breeden warned at the ECB Sintra Forum that autonomous AI agents could "amplify volatility in stress" and that existing regulatory frameworks are not designed for such systems. The BoE is reviewing measures, including enhanced recovery arrangements for core systems and market-wide circuit breakers or "kill switches," if faulty AI models cause market disruption.