The role of brokers in the London money markets

Quarterly Bulletin 1990 Q2
Published on 01 June 1990

This article describes the role of broking firms in the London markets through which banks and other financial institutions conduct their money-market operations. It draws on the Bank of England's longstanding and close relationship with these firms, which now forms the basis of a supervisory framework appropriate for providers of a specialised service to an exclusively professional customer base.

Turnover through the money-market brokers supervised by the Bank has been growing quite steadily during the past two years, with a particularly marked increase in business in forward rate agreements, over-the-counter options and swaps. During the last six months total daily turnover averaged over £115 billion. Competitive pressures are strong in this market, and traditional money-market braking will face new challenges over the next few years.

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