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How the UK keeps the EU27 trading
The UK dominates the world’s foreign currency market – essential for global trade
To trade internationally, countries need foreign currency. The UK has dominated the entire world in foreign currency trading, (known as Forex or more simply ‘FX’), for half a century.
The UK doesn’t just dominate FX in the the whole of the EU (including its ‘Eurozone’). The UK also dominates the world. And without foreign currency, even the mighty Germany would find its international trade would come grinding to a halt.
Brexit Facts4EU.Org Summary
The UK dominates the EU27 in foreign exchange trading
- The UK does 78% of the EU’s foreign exchange trading
- The UK does 21 times more than Germany
- The UK does 13 times more than France
© Brexit Facts4EU.Org - click to enlarge
Our chart above shows clearly that it is the countries of the EU27
who are the minnows when it comes to foreign currency trading.
No other EU country even appears in the world top 5.
© Brexit Facts4EU.Org - click to enlarge
And the UK is still growing faster than all top players, ‘despite Brexit’
Below are the growth rates of the world’s top FX trading centres since the vote to leave the EU. These figures show the change between April 2016 and April 2018 – the latest figures available.
“Despite Brexit” the UK continues to grow at more than twice the rate of its nearest rival (USA).
- United Kingdom: +23%
- USA: +11%
- Singapore: -5%
- Hong Kong: +10%
- Japan: +2%
[Source: Reuters 2018 survey of central banks.]
The UK’s FX growth rate is double that of the USA and Hong Kong and is the fastest of all the major financial centres.
So what does this say about Brexit?
According to the Reuters survey and analysis, over two years after the Referendum:
“Leaving the European Union was supposed to deal a crippling blow to London’s position in global finance, prompting a mass exodus of jobs and business. But with eight months to go, London has tightened rather than weakened its grip on foreign exchange trading.”
“Foreign exchange - the largest and most interconnected of global markets, used by everyone from global airlines to money managers in transactions worth trillions of dollars a day - is the crowning jewel of London’s financial services industry.”
And according to Alexander McDonald, Chief Executive of the industry group European Venues and Intermediaries Association:
“In order for London to be replaced there needs to be an alternative venue and there isn’t one.
“The FX market is effectively an offshore dollar market and offshore dollars are always going to be looking for an international home, and that’s London.”
The Brexit voice of British business
Brexit Facts4EU.Org asked Tom Bohills, Founder of the Alliance for British Entrepreneurs, for his views. Here is what he told us early this morning.
“The positive picture for FX mirrors what ABE is seeing across the other sectors of the City. We were promised the banks would leave and the jobs would go. In fact, City firms are hiring and expanding aggressively. Over the last year alone we have seen multiple announcements of brand spanking new HQs from the very banks that said Brexit would see them move to the EU. Goldman Sachs are building a new £1 billion HQ and Citigroup have taken a £1.2 billion long term lease in Canary Wharf.
“Away from the hysteria of the media’s doom laden commentary the City has quietly adjusted and is not just completely prepared for No Deal, it is already operating on this basis.
“The people who ignorantly spread fear about our financial services sector for political gain should publicly apologise.”
Outside Westminster people are fed up with the shambles that has been going on in Parliament. This morning the media is full of the events of yesterday, when anti-democratic MPs once again refused the request of Prime Minister Johnson to let the people decide who they now wish to govern them.
The ins and outs of all of this – and the convoluted machinations and procedures being used to thwart Brexit – are of limited interest to ordinary people. They know Brexit is being thwarted by a few hundred cosseted individuals in Parliament, but they care little for the arcane details.
The power of Global Brexit Britain
Above we have once again shown the sheer power of Global Britain. No economy – not even the mighty Germany’s – can run without a functioning engine. And it’s the UK’s pre-eminent economic centre which powers this for the EU27.
We were all told that there would be a mass exodus of bankers and traders to Frankfurt and Paris. This simply hasn’t happened because, frankly, no-one wants to go there. International bankers and traders have families, and we have seen many stories of spouses visiting those cities and reviewing the lifestyle, and the education options for the children, and refusing to budge from London.
Like a great many people in the UK, we’re sick and tired of being told what our country can’t do. We prefer the reality.
As the fifth-largest economy on the planet, with a thriving cultural scene, at the centre of the world’s time zones, and being the originator of the world’s common language, the UK is very well-placed to enjoy continued growth and prosperity after Brexit.
Now there's a positive thought to brighten your day!
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[ Sources: International Bank for Settlements | Reuters ] Politicians and journalists can contact us for details, as ever.
Brexit Facts4EU.Org, 10 Sep 2019
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