For decades the City of London has liked to compare itself to Wimbledon, where the UK puts on a great global show in the annual tennis tournament, with or without a domestic winner. The state of UK tennis is akin to that of the economy; the Square Mile powers on, drawing an international audience while being oblivious to local weaknesses, most notably the pandemic-induced slowdown in daily activity. The analogy has slipped slightly, of course, with the arrival of Andy Murray and latterly Emma Raducanu. Nevertheless, the message still resonates, that the UK is excellent at hosting a global party, a country that punches above its weight. As we enter 2022, in the City that feeling has never been stronger. It’s as if they occupy parallel universes: the City and its tall towers, and the nation below in which others work and live. For investment banks, traders, hedge funds, private equity, law firms, accountants, wealth managers — the list goes on — this has been a strong year. A new one is about to begin and they are looking forward to that as well, buoyed with the hope that it could be even better than 2021. Bonuses have been satisfactory, deal-making has been strong, equity and debt fund-raising have produced, commissions are up, mandates similarly, and the markets, well, they keep on delivering. Meanwhile, at street level, people are grappling with a pandemic, climate change continues to assert its influence, traditional “bricks and mortar” businesses struggle to adapt, supply chains are heavily disrupted, labour shortages abound, and energy prices climb. In the UK, Brexit has further lengthened delays and added to staffing difficulties in some sectors. Trade with the EU has suffered. WFH, three letters that were not in common parlance two years ago — indeed, if anyone said they were “working from home” eyebrows would often rise, casting aspersions that they were slacking — is now accepted and having a lasting impact on cities and town centres, office developments and transport. Nowhere is that lifestyle shift more evident than in London, in the City proper and eastward, in Canary Wharf. Yet the partially deserted buildings and quiet pavements and walkways do not reflect the City's mood. Sure, commercial landlords will have to switch, creating more flexible working spaces, and those enterprises that relied upon servicing offices will suffer. Overall, though, going into the New Year, the mood of the financial and investment community is one of fingers crossed, quiet confidence. Even the prospect of inflation has done little to dampen the cautious optimism. After all, the application of higher interest rates to put a brake on rising prices can spell good times for financial firms, for banks, insurers, wealth management and investment platforms. The notion that the City is fixated upon the FTSE 100 no longer applies. Which is just as well since the leading UK share index will lag behind its foreign counterparts. In the US, soaring stock markets have reached record levels. This, again it is worth reiterating, despite the advent of a new Covid variant. The reason for the sustained rise in the S&P 500 can be evidenced by mention of its leading stocks, such as Amazon, Alphabet, Microsoft, Apple, to name its top four. This, versus the FTSE-100 highest quartet of Shell, AstraZeneca, BP and Unilever. I know where I’d rather park my cash. In a sense that does not matter greatly for the underlying strength of the City — it’s a global centre, the biggest along with New York, drawing investors from all over Europe, the Middle East, Africa and Asia. They can route their US plays via London. Wall Street’s Opening Bell has become a key moment in the UK day. Neither is it terribly significant that the tech giants belong in the US. What carries greater weight in the City is that tectonic shifts are occurring. It’s a place that thrives on change and tech, especially FinTech, is poised to reap huge gains in the years ahead. These will be businesses that require advice, developing and nurturing. They will need to secure financing. London, pre-eminent in capital markets, is rubbing its hands. Yes, there has been Brexit-induced movement, but not on anything like the scale that the doomsters forecast. By now, it was thought in some quarters there would be a drain of talent away from the City to other centres in the EU. That has not happened. This, too, comes against an absence of clarity surrounding the post-Brexit rules governing financial services. For the moment, no European location has shown itself capable of mounting a sustained challenge to London; they’re all similar, no one place has jumped out of the pack. They lack the scale, the depth and breadth, of the UK leader. It would be foolish to suppose that a decent year is a given. The City is treading carefully. Covid has taught us not to take anything for granted; the wake-up call it provided was that at any moment the world’s economic system can go into spasm. Two years on and we’ve become used to living with the outbreak. However, another more dangerous variant could be just around the corner, or a different virus completely. Much of the positive buzz has stemmed from bounce-back, from the lifting of lockdown restrictions and industries being able to return to pre-Covid levels. Not all were so fortunate — travel and aviation remain a worry. As we go into January, many countries are imposing tight rules to try to combat the spread of the Omicron variant. How long these safeguards will stay in place and their effect on economic activity are uncertain. Omicron appears less lethal but more transmissible. How that will hit staffing and the ability of businesses to function has yet to be determined. Energy prices this winter are another cause for concern. There are those who insist the markets are overvalued, that they’ve benefited artificially from the central banks’ multi-trillion dollar quantitative easing stimulus programmes designed to underpin, to create stability. At some point, this pump will be turned off. That’s all in the future. For now, the City can give thanks to a surprisingly decent year, all things considered, and welcome the year to come.