The decision by the CME Group to establish a European exchange highlights the growing demand among trading firms for "regulatory choice", the company has said.

The CME Group this morning confirmed plans to launch a London-based derivatives exchange, in a move that will see it compete with rivals run by NYSE Euronext and Deutsche Börse. The derivatives giant is applying to the UK Financial Services Authority for a recognised investment exchange license and will initially begin trading foreign exchange futures products in mid-2013, the company said.