The economic strength and political influence of the financial services sector is a distinctive feature of British business which merits separate treatment. The financial sector is often referred to as the ‘City’, but although this is a convenient shorthand, it has always been something of a misnomer, and has become even more so as financial institutions have moved away from the ‘square mile’ in search of dealing rooms which give them the space to cope with round-the-clock international trading. Although the British financial sector has been distinguished for centuries by its international orientation, ‘Perhaps for the first time it is now possible to speak of a single world financial market’ (Coggan, 1989, p. 9). Financial globalisation has been a major driving force behind economic globalisation, and has been accompanied by the growth of ‘financial engineering’, the creation of customised products for both borrower and investor. Financial globalisation has been made possible by developments in information technology which have been facilitated what has, in effect, now become twenty-four hour international financial trading. As one of the three great financial centres of the world, along with Tokyo and New York, London is at the centre of these developments. For example, by 1989, according to the Bank for International Settlements, monthly turnover on the foreign exchange market was $3,740 billion in the UK, compared with $2,580 billion in the US, and $2,300 billion in Japan.
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