Premier League clubs felt the impact of a weaker pound this January transfer window, increasing their incentive to shop domestically rather than abroad.
For the first time in four transfer windows, less than half of the players signed by Premier League clubs came from foreign leagues.
Well over £100m was splashed out on players already based in England and Wales last month, compared to £65m a year ago when over two-thirds of all expenditure went out of the country.
In that time the value of the pound has fallen 12 per cent from £1/€1.32 to £1/€1.16, requiring clubs to fork out more from their coffers to meet valuations for top players based abroad.
For example, Arsenal’s £5m purchase of Mohamed Elneny 12 months ago would cost the club an extra £700,000 today, while Stoke’s club-record £18m on Gianni Imbula would come in at over £20m.
Furthermore, European clubs are prepared to drive a hard bargain knowing that Premier League sides are wealthier than ever thanks to an £8bn TV deal that guarantees each club a minimum of £99m in revenue.
“There’s been a notable difference,” Richard de Meo, who works with top flight teams as managing director of FX firm Foenix Partners, told City A.M.
“It is no coincidence at all that we’ve seen such a sharp drop off in the number of players being bought from Europe.
“Premier League clubs that we deal with have been looking at players but there hasn’t been any follow through and they haven’t sealed any deals.
“English clubs are suffering from the fact that they’re still perceived [by European clubs] as having a lot of money due to the TV rights and the windfall deals of the summer and there is an impact due to the pound.
“If a player has an unchanged price in euro terms, that player has become 15 per cent more expensive than last January.”
English teams capitalised on a contrasting state of affairs in the summer of 2015 when a pound could be traded for as much as €1.44, encouraging clubs to splash out just shy of £500m on players from the euro zone.
A number of Premier League clubs have recently hedged against currency risk including Leicester, West Ham and Watford who have agreed sponsorship agreements with foreign exchange firms who provide them with favourable rates in return.