Donald Trump's victory in the U.S. presidential election has increased the threats to the world economy from higher interest rates and less trade according to the Bank of England.
The BoE also pointed to potential dangers from rapid Chinese credit growth or a disorganised British departure from the European Union in a half-yearly assessment of risks to Britain's financial system.
BoE Governor Mark Carney highlighted a big rise in U.S. market interest rates since Trump's victory, which the Bank said could be a precursor to a destabilising sharp move higher in global government borrowing costs from previous record lows.
Yields on U.S. 10-year government bonds - which influence borrowing costs globally - are on track for their biggest monthly rise since December 2009 following Trump's unexpected victory on Nov. 8.
"The U.S. election has reinforced existing vulnerabilities," the central bank said in its report. "The rise in advanced economy sovereign yields, coupled with risks of reduced global trade, has reinforced the vulnerabilities associated with those emerging market economies with high levels of debt."
Trump has said he wants to boost infrastructure spending and cut taxes. This could boost U.S. economic growth but also raises the prospect of higher U.S. government borrowing costs and inflation globally when many economies are still struggling to overcome the effects of the 2007-09 global financial crisis.
For rich economies, a rapid rise in bond yields from near-zero levels could hurt bank lending and lead to market instability, the BoE said.
Carney said any new protectionist U.S. trade policies could throw "sand in the gears" of the global economy, with knock-on effects for Britain.
Trump has said he will scrap a planned trade deal with Asian economies to bolster U.S. job creation and suggested that he could pull the United States out of the World Trade Organisation if its rules stopped him renegotiating U.S. terms of trade.
"There is this possibility that the slowdown in the growth in world trade, which we have seen over the past few years, accelerates because of discrete policy initiatives potentially from the world's largest economy," he told a news conference.
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