Reuters: Britain backtracks over Brexit curbs on cross-border swaps trading
The City of London’s unfettered access to the European Union, its biggest customer, ends when Brexit transition arrangements expire at 2300 GMT, and without the change of heart UK and EU market participants would have been unable to trade swaps with each other when markets reopen on Jan. 4.
Branches of EU banks in London would have been particularly hit as the trade deal agreed by the EU and Britain last week does not cover financial market access.
Faced with the EU’s refusal to lift its own ban on trading swaps on platforms in London, Britain’s Financial Conduct Authority (FCA) said it would temporarily allow UK financial firms to use venues in the bloc if they do not have arrangements in place to execute the trade elsewhere, such as in the United States.
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