London lords it over continental rivals

The reasons given for the City's pre-eminence are fairly obvious and are not new. Its geographical location sandwiched between Asia and the US enables it to cater to both markets and provide continuity between the different time zones. London's traditional strength as a global investment hub and the more recent emergence of a healthy hedge fund management community mean there are plenty of active participants for banks, platforms and brokers to deal with.

However, none of these factors are unique to London. Frankfurt is equally well positioned in terms of international time-zones. It too boasts a healthy financial community and benefits from being a eurozone economy, meaning it is the natural home for transactions in the world's second currency. Zurich is also well populated with financial institutions that have global reach and plenty of money with which to participate on the global markets.

Frankfurt and Zurich on many counts make far more sense to run international global financial markets from. The infrastructure of the continental European cities is far superior to London's, which has seen decades of underinvestment result in a transport system that is struggling to carry the weight of a growing workforce.

The remuneration that banks must pay in London must be eye-watering for finance directors. Holding onto quality staff in Switzerland and Germany is far less costly, and there is ample talent to mine in these centres where the education system arguably delivers more polished raw material than can be found in the UK.

But when it comes down to choosing where to base global operations, financial institutions nearly always opt for London. The main reason for this is a by-product of the city's history. London is and always has been a genuinely international city. From the time that Saxons took on the local population the British psyche has become used to dealing with and profiting from foreigners who come here to set up shop. London's position as the dynamo at the centre of the forex world will continue as long as the country takes the pragmatic view that accepting foreigners in the long run brings financial rewards.