Turnover reached fresh highs in three key financial markets, according to a report from British Invisibles, the body which promotes financial and other services.
For the first time, dealing in United Kingdom equities exceeded a trillion pounds, rising 36 per cent compared with 1996 to pounds 1,013bn. Although London is only the third biggest stock market for domestic equities, behind New York and Tokyo, it is the world's biggest relative to the size of the economy.
International trading in eurobonds climbed 45 per cent to pounds 8,450bn, with seven-tenths of this business based in London.
And cross-border trading in foreign equities rose by 39 per cent to pounds 1,443bn last year. Here London has a 62 per cent share of global business.
The report acclaimed London's dominant position, and said some City activities could benefit from the start of EMU even with Britain staying outside. For example, it argued that the London Stock Exchange could benefit from an upsurge in European equities trading across borders.
The report warned of a particular threat to trading in EMU-area bonds, where the City's position is currently strong. Multinationals might see merit in switching their business to banks in an EMU country, it said.Reuse content