The City takes fresh Brexit hit as carbon futures trading heads for Amsterdam
Trading of European carbon futures will move to Amsterdam from London in the coming months, Intercontinental Exchange (ICE) announced last night.
The move is another setback for The City and the latest sign of activity leaving London for the bloc following Brexit.
The City has been largely cut off from the EU since 1 January, as the new trade deal does not cover financial market access.
Trading shifts
More than €6bn a day of euro-denominated share trading has already left London for Amsterdam and Paris.
Stuart Williams, president of ICE, said the decision follows close consultation with customers in a bid to deliver services in a cost-effective manner.
EU carbon allowances are the currency used by the bloc to help reduce the greenhouse gas emissions that cause climate change.
ICE, one of the main exchanges trading the currency, will avoid the cost of having to set up a new Brexit hub in the EU by moving to the Netherlands.
Brexit setbacks
The setback comes as business leaders claimed Brexit is a bigger problem for their companies than the economic impact of Covid-19.
The UK’s five biggest business groups recently warned the government that companies face “significant disruption” if post-Brexit conditions are not eased.
London-based Rick Smith, managing director of financial advisory Forbes Burton, told City A.M.: “Brexit is a real concern for many companies. The deal has indeed been done, but we are only now finding out what the fine print was and what this might mean for business.
“The fishing industry is a good indicator of how it might impact other industries. As a headline issue, it has gained a lot of immediate focus, but could point to where other industries might struggle.”