FCA CEO Rathi says traditional AI rulemaking cycle 'doesn't work' as agentic AI accelerates

According to CNBC, U.K. Financial Conduct Authority CEO Nikhil Rathi said the traditional cycle of financial rulemaking “doesn’t work” as fast-moving, agentic AI development accelerates, and called for new tools and more collaborative work with markets to manage risks while supporting adoption. CNBC reported that European Central Bank President Christine Lagarde told Les Échos that AI can boost productivity but also poses a “major risk,” warning that defenses and the funding required for them “have yet to be found.” The report also cited Bank of England Deputy Governor Sarah Breeden as saying agentic AI could amplify volatility during market stress and may require oversight measures such as guardrails “analogous to circuit breakers or kill switches” to limit or stop trading if faulty AI models trigger a market meltdown.