Bank of England Governor Warns AI Investment Boom Could Trigger Market Shocks

Bank of England Governor Andrew Bailey has warned that the rapid flow of money into artificial intelligence companies could lead to sharp corrections in financial markets if high investor expectations are not met. He said firms including Alphabet, Meta, Microsoft and Amazon are spending heavily on AI, while companies such as Nvidia have reached record valuations. Bailey noted that not every company attracting AI investment will emerge as a long-term winner. He also raised concerns about AI-enabled cyber attacks and deepfakes, saying the technology can expose weaknesses in widely used software and make false images or videos harder to trace. Despite the risks, he said AI can support economic growth and help policymakers analyse information, without replacing human decision-making.

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