Britain and the United States agreed to maintain how multi-trillion dollar financial transactions are carried out between the two countries after Brexit, aiming to avoid market uncertainty when the UK leaves the EU.
“Market participants can be assured of the continuity of derivatives trading and clearing activities between the UK and US, after the UK’s withdrawal from the EU,” said a joint statement by authorities in both countries.
“UK and US authorities are taking measures to ensure the UK’s withdrawal from the EU, in whatever form it takes, will not create regulatory uncertainty,” it added.
The UK and US carry out trades of derivatives — securities whose value is based on an asset such as currencies, stocks and commodities — worth a combined $2.4 trillion daily, Bank of England governor Mark Carney told a press conference in London.
British Finance Minister Philip Hammond on Monday said that “the US and UK are fundamental to the smooth functioning of the world’s multi-trillion pound derivatives markets, with around 97 percent of the centrally cleared interest rate derivatives market located in London”.