BoE tells banks to brace for dollar shock

The Bank of England has urged banks to thoroughly evaluate their preparedness for shocks related to the US dollar. As Trump’s policies create uncertainty in global markets, European regulators are prompted to reassess their reliance on the dollar, leading to suggestions of stress-testing financial systems.

Economists express doubts about the US Federal Reserve’s willingness to provide aid in the event of a dollar crisis, heightening concerns among European banks. Continuous reliance on the dollar for operations places these institutions under pressure to analyze their resilience in volatile financial environments.