Bank of England Governor Warns AI Could Spark Global Economic Downturn

The governor of the Bank of England has warned that artificial intelligence could trigger a global economic downturn. Andrew Bailey, in his capacity as chairman of the Financial Stability Board, wrote to G20 finance ministers about the potential risks.

He cited 'fragilities in sovereign debt markets' and the increasing cross-investment between AI companies and hyper scalers, which he believes could amplify a future market correction.

The warning comes as the UK government announced a £100 million fund to support British AI start-ups. The goal is to grow the country's 'Sovereign AI' capacity, with an emphasis on homegrown technology that can reduce dependence on foreign services and infrastructure.