Market participants have interpreted UK Prime Minister
Theresa May’s speech on Britain’s
departure from the EU as a threat to pursuing a so-called free
market financial centre model if access via equivalence is not
granted.
The UK will leave the EU’s single market and
instead pursue a 'new and bold’ free trade
agreement, according to May in a speech today. The announcement
was unsurprising to many London-based financial markets
participants, who anticipated the removal of single market
membership following the referendum vote in June last year.
May said that she wanted a customs agreement with the EU
while rejecting the common external tariff that prevents
Britain from negotiating separate trade deals with third
countries.