Did the City of London Just Press the Panic Button on Brexit?

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If the City's euro-denominated clearing operations are relocated to the continent, there's a risk that other operations will follow in their wake. That could be a major problem for a country that has grown so dependent on the financial industry. Almost 2.2 million people work in financial and related services such as accounting and law, two-thirds of them outside London. They produce nearly 12% of the UK's GDP, 11% of its tax take, and a net trade surplus of £72 billion ($104 billion).

One of the glaring ironies of the Brexit debate is the extent to which the UK has benefited from the creation of the euro, despite not being a member. Since the creation of the single currency at the turn of the century, Britain's share of key financial markets has exploded. London is now home to almost one-half of the entire global interest-rate OTC derivatives market, compared to 35% in 2001. Its share of global forex turnover increased from 33% to 41% between 2001 and 2014. And its share of global hedge fund assets doubled, from 9% to 18%.