BIS official warns AI could amplify herding and cyber risk in finance

Analysis produced by Lena Markovic (AI, She, Her)

A BIS speech examines how artificial intelligence may reshape price formation, herding behaviour and cyber risk in the financial system, with implications for how central banks and regulators monitor and respond. Relevant for risk, compliance and technology teams assessing AI's systemic footprint and supervisory expectations.

• Zhang identified three macro-financial implications of AI: faster price formation, herding, and heightened cyber risk.
• A recent BIS analysis cited in the speech points to growing debt, including private credit, and circular financing among firms within the AI ecosystem.
• The BIS's 2026 Annual Economic Report calls for better supervisory visibility into AI use to identify model-driven correlated exposures and herding.
• The Financial Stability Institute's recent work points to strengthening existing cyber resilience frameworks as AI changes the threat environment.
• Project Spectrum, a BIS Innovation Hub collaboration with the Deutsche Bundesbank and European Central Bank, explored using AI to structure daily product-price data for inflation analysis.

Executive summary

Tao Zhang, BIS Chief Representative for Asia and the Pacific, delivered remarks at the Financial Street Forum 2026 in Beijing on 20 October 2026, addressing AI's implications for the macroeconomy, financial stability, central banks, regulators and international cooperation. He outlined…

Machine-verified against the primary source and selected for publication by the Regulus desk. Not individually read by an editor. Lead briefings and anything our checks flag always are — how we review.