Bank of England

The Bank of England, founded in 1694, is the United Kingdom's central bank, headquartered on Threadneedle Street in the City of London. It sets interest rates via its Monetary Policy Committee, supervises financial institutions through its Prudential Regulation Authority arm, and acts as lender of last resort to the UK banking system. Its primary mandate is price stability, anchored to a 2% inflation target.

In early 2026, the BoE became one of the first major central Banks to name AI-sector overvaluation as a systemic risk, warning of "growing risks of a global market correction" from tech-firm concentration . The warning put it at odds with Morgan Stanley, which argued bubble fears were "misplaced" given the cash reserves of the largest firms .

The tension cuts to the heart of the BoE's dual role: guardian of financial stability and reluctant spectator to a technology-driven productivity surge it cannot directly control. If the AI correction materialises, the exposure of UK pension funds and insurers to US tech equities would transmit the shock directly into UK households, testing whether a 330-year-old institution can contain a crisis born in Silicon Valley.