FTT and UK Financial Shares

Research Articles

Our Head of Research Anthony Grech offers in-depth analysis into a range of topics, helping add to your knowledge of the financial markets. These free topical reports, accessible to account holders only, track the historic performance of various markets.

Below is a snapshot of Anthony's report on the recent German-Franco summit and its discussion of the Financial Transactions Tax (FTT), and the impact on UK financial shares. To read the full report, open an account and get set up in minutes.

August 2011

The Financial Transactions Tax and its impact on UK financial shares

On 16 August French President Nicholas Sarkozy and German Chancellor Angela Merkel announced proposals to boost fiscal convergence in the eurozone as part of a long-term plan to resolve the region's debt crisis. Calls to expand the €440 billion rescue fund were ruled out, as the current size of the European Financial Stability Facility (EFSF) was deemed sufficient. Chancellor Merkel also said eurobonds would not solve the eurozone's problems, while President Sarkozy said they could hurt the region’s healthiest countries, adding that eurobonds 'could be imagined one day in the future'. Mr Sarkozy also said that all of the eurozone countries should have a balanced budget rule, while Ms Merkel pushed for greater economic policy co-operation.

Toward the end of the summit, the German chancellor and French president said that they were not pessimistic about Europe's economic outlook, and revived proposals for a Financial Transaction Tax (FTT), though no further information was provided. The details of the FTT are likely to emerge in September, with a view to implementation by 2013.

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