From Yahoo Finance: 2025-04-10 11:15:00

The Bank of England warns of global risks affecting financial stability due to heightened geopolitical tensions, including US tariffs. The UK’s open economy and large financial sector make it vulnerable. Despite concerns, the UK banking system is well-capitalized and resilient, able to support households and businesses in adverse conditions.

The central bank will assess the banking sector’s resilience through the 2025 Bank Capital Stress Test. This new test replaces the previous Annual Cyclical Scenario and evaluates the sector’s ability to withstand hypothetical stress scenarios involving declining asset prices, severe recessions, and rising global interest rates. The BoE’s vigilance comes after US President Trump’s tariff policies caused market volatility.

Trump recently announced a three-month pause on reciprocal tariffs, except those targeting China. He also stated that tariffs on China would increase to 125% from 104% in response to China’s retaliatory tariffs. The BoE’s warnings highlight the importance of monitoring and maintaining financial stability amidst uncertain global economic conditions.

Read more: Bank of England warns of increasing risks to financial stability