The Bank of England just said the quiet part out loud: the humans might not be in charge of financial markets much longer, and that should worry everyone.
Deputy Governor Sarah Breeden warned on June 30 that “agentic” AI systems, the kind that can make decisions and execute trades without waiting for a human to hit approve, could soon operate across the entire financial system. Speaking at the European Central Bank Forum on Central Banking in Sintra, Portugal, Breeden laid out a scenario where relying on human oversight of these systems “might no longer be realistic.”
The herding problem
Here’s the thing about AI trading agents: they tend to learn from similar data, train on similar models, and optimize for similar outcomes. Breeden’s core concern is what happens when thousands of these agents respond to the same market trigger at the same time.
Breeden specifically warned that if AI agents respond similarly to identical triggers, they could exacerbate market volatility significantly, particularly during stressed conditions. The Bank of England is actively conducting simulations with international bodies to study exactly this kind of herding behavior among AI trading agents.
