Bank of England Governor Stresses Need for Global Financial Cooperation

In a letter dated July 14, 2025, Andrew Bailey, Governor of the Bank of England and Chair of the Financial Stability Board (FSB), emphasized the necessity of international cooperation to ensure global financial stability amid ongoing uncertainties. Addressed to G20 finance ministers and central bank governors, Bailey highlighted that persistent uncertainty continues to weigh on global growth expectations and stressed the importance of collective responses to potential financial shocks. (source)

Bailey noted that while market conditions have improved since the turbulence caused by U.S. trade policy in April, vigilance remains essential due to the risk of disruptive market moves. He assured that the FSB is actively monitoring developments and stands ready to act if necessary. (source)

The FSB, established by the G20 in the aftermath of the 2008 financial crisis, coordinates national financial authorities and international standard-setting bodies to promote international financial stability. Bailey emphasized that the FSB's broad and varied membership makes it uniquely placed to deliver on its mandate. (source)

In April 2025, the announcement of U.S. trade tariffs led to significant volatility in global financial markets. Although markets have since stabilized, Bailey stressed the need for continued vigilance against potential disruptive market moves. (source)

On the same day as Bailey's letter, the FSB presented a new plan to tackle climate risks, focusing on enhanced coordination and data sharing among member nations. However, the FSB announced a pause in further policy development due to divisions among member countries, notably the United States' withdrawal from several climate-related financial groups. The FSB affirmed it would continue considering climate risks annually and retain its coordinating role but refrained from committing to new policy initiatives. (source)

Bailey's call for international cooperation highlights the interconnectedness of global financial systems and the potential for localized economic policies to have widespread repercussions. The emphasis on vigilance suggests that, despite recent market recoveries, underlying vulnerabilities persist. The pause in climate-related policy development indicates challenges in achieving consensus on global financial policies, potentially delaying coordinated efforts to address climate risks.

In conclusion, Bailey's letter serves as a timely reminder of the importance of international cooperation in maintaining financial stability, especially in the face of geopolitical tensions and emerging risks such as climate change.