ABSTRACT
This chapter deals with the impact of economic and monetary union (EMU) on each individual market of the City of London, and, on the institutions acting in them. The traditional London money market is represented by the market in Treasury and commercial bills, that is, promissory notes by the government and commercial firms, guaranteed by the Accepting Houses and discounted by the traditional and closed club of Discount Houses. Given its evident global character, if the UK remained outside the EMU area, the competitive threats for London as a centre for foreign exchange trading activity were judged to be fairly low. The announcement by London International Financial Futures Exchange that existing Euro-mark, short sterling and Euro-lira contracts would settle on Euro-rates after 1999 in the event of German UK and Italian participation in EMU already provided the exchange with a head start over continental rivals.
