No, Anglo-Saxon isn’t a “racist” term.
If you think Anglo-Saxon is a “racist” term, you are a woke moron. Virtually no one who lived in Early Medieval Britain was non-White. There were only a handful of exceptions like the Syrian Christian Theodore of Tarsus who was the Archbishop of Canterbury. You could gather up all the non-White people who lived in Britain back then and they wouldn’t fill up a building.
The whole population of Britain was “White” in those days although the term had no salience as a marker of identity. Everyone was “White” from kings down to commoners so the distinction didn’t matter. The people who were descended from Germanic settlers who came in the 5th and 6th centuries coalesced and came to think of themselves as Anglo-Saxons and the English in this period. Perhaps a majority of the people who over time became the English were themselves conquered Romano-Britons who were assimilated as Old English speakers. These groups intermarried over time. The distinctions that mattered in those days were mostly tribe, language, religion and class. Race included almost everyone in the known world at the time.
The fact that White Nationalists are interested in Anglo-Saxon, Celtic or Norse history proves nothing except that they tend to be ethnocentric. There is nothing unusual or immoral about being interested in your own ethnic origins. It has nothing to do with anyone else, particularly with blacks, who weren’t encountered or enslaved by our ancestors in Africa and brought here to North America until a thousand years later. The current plague of political correctness and wokeness which has infected academia doesn’t go back more than a few decades.
Anglo-Saxonism DID BECOME racist in the modern era. The Anglos who settled Texas and won the Texas Revolution DID believe in their own racial superiority as an Anglo-Saxon race. The English came to believe they were racially superior to the Irish and other Europeans. They were the most xenophobic and ethnocentric of all Europeans who came to the New World. This is a world that was far removed from Britain in the Early Middle Ages though. The people who lived in England in this time spoke a language which is unintelligible to modern English speakers.
Note: It goes without saying that no one who lived in Early Medieval Britain was a liberal either much less a woke one. Their total absence is one of the reasons why I enjoy reading and learning about the subject. I wish those people would disappear in our own times.