LeadershipNot yet confirmed elsewhere1 publisher2 min readPublished
Bank of England's Breeden backs AI for growth while warning of rogue agents
Bank of England deputy governor Sarah Breeden called leveraging AI the "best pathway" to economic growth in an Atlantic Council interview. She also said an increasingly autonomous financial system could act in ways regulators do not expect.
The Board Room · Leadership desk
What happened
- Her remarks follow earlier warnings from the Financial Policy Committee, which includes Breeden and Andrew Bailey, about knock-on effects for stock markets after rapid AI growth.
- Bailey has separately asked the government to ramp up testing of frontier AI models before public launch, citing the 'closed loop' nature of the leading tools.
- On the digital pound, a detailed blueprint and joint assessment with the Treasury are expected by the end of the year and will decide whether the project moves forward.
Why it matters
- exposure Firms putting autonomous agents into UK finance face a Bank that has named misuse and rogue behaviour as the two scenarios it is preparing for.
- contradiction Breeden's optimism and the stock-market warnings come from the same committee, so the growth message does not soften the risk message.
- decision The year-end digital pound assessment has to settle whether stablecoins and commercial bank money make a central bank currency unnecessary, and Breeden has signalled she is open to waiting.
Breeden's two messages run on different clocks. The growth case is long-range. She said "We should be optimists about AI" [3] and added "we've been talking a long time about how our economies need growth" [4]. Her framing was that "AI as a general purpose technology and then innovation has got to be our best pathway at getting growth" [2]. The resilience case is near-term, since it concerns what the Bank "might need to act now" on for future use cases [6].
The two scenarios she named call for different responses [5]. In our view, misuse by bad actors is a security problem, because someone intends harm, and a rogue agent is a control problem, because a system does something nobody intended. Breeden described the Bank's focus as "how an increasingly autonomous financial system that's operating at speed and scale might do things that we're not expecting it to" [5].
The trade-off is adoption speed against the Bank's visibility into what autonomous systems are doing. The interview as reported does not set out a measure or a timetable for where that line sits. Until the Bank publishes something firms can plan against, "act now" is a direction. Breeden's brief includes payments innovation and fintech [8], so the warning comes from an official who also oversees the adoption side.
The digital pound shows how she weighs timing when a decision has a date. Earlier this year the ECB announced next steps for the digital euro, setting the stage for a launch in 2029 [13]. In the UK no decision has been reached, and Breeden suggested the Bank may not have to be "leading the way" [14]. She said that whether stablecoins and commercial bank money could achieve the same benefits is a crucial factor [15]. Breeden said: "If they are delivering the benefits and we have made sure their value is anchored then maybe we don't need a digital pound so quickly" [16].
What to watch
- Whether the Bank turns 'act now' into a published measure, scenario or timetable for autonomous AI agents in finance.
- Whether the year-end digital pound assessment gives stablecoins and commercial bank money a formal role in the decision.
- Whether the government responds to Bailey's call for more testing of frontier AI models before public launch.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence55
- Adoption
- Insufficient
- Hype gap+10
- Incentives
- Insufficient
- Confidence60
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
Sarah Breeden, deputy governor for financial stability at the Bank of England, called for optimism around AI and said leveraging the technology is the 'best pathway' to securing economic growth.
ReportedSupportedSource: City AM report of Sarah Breeden's Atlantic Council interviewView cited source - [2]
Breeden said: "AI as a general purpose technology and then innovation has got to be our best pathway at getting growth".
- [3]
Breeden said: "We should be optimists about AI".
- [4]
Breeden said: "we've been talking a long time about how our economies need growth".
- [5]
Breeden said the Bank is focused on "how an increasingly autonomous financial system that's operating at speed and scale might do things that we're not expecting it to", which she said might be because AI is in the hands of bad actors or because AI agents have gone rogue.
- [6]
Breeden said the UK needs to 'think ahead' on future use cases of AI for "how we might need to act now to be resilient about them".
- [7]
The remarks were made in an interview with the think tank Atlantic Council as part of the IMF-World Bank meetings in Thailand.
- [8]
Breeden is also tasked with overseeing payments innovation and fintech at the Bank of England.
- [9]
Bank officials on the Financial Policy Committee, which includes Breeden and governor Andrew Bailey, have previously sounded off on the potential knock-on effects for stock markets following rapid AI growth.
- [10]
Andrew Bailey has called on the government to ramp up testing of frontier AI models before they are launched to the public, after raising concerns about the 'closed loop' nature of the world's top tech tools.
- [11]
The retail digital pound project, a joint venture with the Treasury, has sought to explore and design a retail central bank digital currency for the UK, and is due to be updated on later this year.
- [12]
A detailed blueprint and joint evidence-based assessment on the digital pound are expected by the end of the year and will decide whether to move forward.
- [13]
Earlier this year the European Central Bank announced the next steps for the digital euro, setting the stage for a launch in 2029.
- [14]
No decision has yet been reached on the UK digital pound project, and Breeden suggested the Bank may not have to be 'leading the way'.
- [15]
Breeden said whether stablecoins and commercial bank money could achieve the same benefits as a digital currency would be a crucial factor in decision making.
- [16]
Breeden said: "If they are delivering the benefits and we have made sure their value is anchored then maybe we don't need a digital pound so quickly".
Sources
1 independent publisher whose own reporting we read for this story.
- cityam.comWe should be AI optimists, says Bank of England deputy
1 article · October 12, 2026
Topics and entities
Follow any of these and your For You feed starts watching them — no settings page required.
Topics
- Central bank views on AIFollow
- Central Bank Digital CurrenciesFollow
- Autonomous AI agents in financeFollow