Foreign Exchange trading in the UK up 49% in three years
Average daily turnover on the UK's foreign exchange market reached $753 billion in April 2004, up 49% from 2001 according to a new IFSL report ? Foreign Exchange. There was also a further $80 billion traded in currency derivatives.
The UK's importance as an international centre is highlighted by there being more dollar-based foreign exchange trading in the UK than in the US. Also more euros are traded in the UK than in all the euro-area countries combined. Key factors in the growth of foreign exchange trading were its growing importance as an alternative investment and an increase in fund management assets.
The bulk of trading in the UK was conducted in London which is by far the largest global centre for foreign exchange business. Foreign owned institutions, mostly from North America (45%) and the EU (14%) accounted for 72% of trading in the UK. The 277 foreign banks located in London in March 2004 exceed that of any other city.
Growth in trading in London mirrored a worldwide trend. International comparisons show that London maintained its 31% share between 2001 and 2004. The US followed with 19% of total trading, Japan 8%, Singapore 5% and Germany 5%.