Financial markets watchdogs on both sides of the Atlantic should immediately start drafting rules for closer regulatory co-operation and include industry to avoid a “regulatory love-in” that could stall progress towards creation of a transatlantic securities market, an influential securities industry group said on Tuesday.

The call comes ahead of a visit to Washington at the end of next month by Angela Merkel, German chancellor, who is expected to push a plan to harmonise regulations – including those for financial services.