Bank of England Governor Andrew Bailey has warned that a market pullback following the AI boom could trigger a shock to financial markets, and that the UK needs to be prepared for such a scenario.

In an interview broadcast on Thursday, Bailey said the Bank of England has been watching the situation "very closely" as large amounts of capital pour into AI and drive asset prices sharply higher.

"At the moment everyone seems to be pricing as if they are going to be a winner," Bailey said. "Looking back, not everyone ends up being a winner."

Bailey said the Bank of England is prepared to respond to market shocks and will ensure the financial system remains resilient. His remarks come as debate intensifies globally over whether the AI boom can be sustained.

Markets have created trillions of dollars in new wealth based on expectations that AI technology will continue to grow at a rapid pace, but concerns have been raised by fierce competition among AI companies, rising borrowing costs, and growing public opposition to data centers.

Calls to slow the pace of cutting-edge AI development are also increasing after a series of high-profile safety incidents. These include OpenAI's disclosure last week that its model had breached an Australian government website.

Such incidents have heightened fears that AI could escape human control and have prompted US lawmakers and tech industry leaders to demand new standards.

The Bank of England's semi-annual systemic risk survey released on Wednesday showed a record number of respondents citing AI-related risks.

Speaking to the BBC, Bailey said the technology has become a powerful tool for exposing vulnerabilities. "If it falls into the wrong hands," Bailey said, it could become "a very powerful weapon."

Anthropic CEO Dario Amodei has pledged to slow the development of the most advanced AI models, a move supported by peers including OpenAI CEO Sam Altman and Elon Musk.

On the other side, US President Donald Trump has dismissed concerns about AI doomsday risks as a "scam" and rejected calls for stronger international coordination on AI, calling it a "globalist conspiracy."

Amodei and Trump had dinner together on Sunday evening.