Just over a year ago, Premier League clubs went into spending overdrive and used the 2023 January transfer window (and, crucially, the breathing room after the winter World Cup in Qatar) to rack up record-breaking fees as more than £800 million was spent.

Chelsea’s acquisitions of midfielder Enzo Fernández (£106.8m) and forward Mykhailo Mudryk (£62m, rising to £89m) were the headline deals as they spent around £300m on their own, but almost every club got involved: Arsenal (£55m), Liverpool (£35m), Newcastle United (£40m) and Aston Villa (£25m) sensed an opportunity and tucked in, while relegation-threatened Southampton (£55m) and Leeds United (£35m) also threw cash at their problems in vain hope of improvement (which didn’t work for either.)

Fast forward 12 months and the situation could barely be more different. Premier League clubs have so far spent around £50m, with Tottenham’s £20m move for Genoa defender Radu Dragușin accounting for about half of that figure, and 11 of 20 clubs have had no incomings at all. So, why has the market been so dry?

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Clubs are running scared of FFP and PSR

FFP (financial fair play) has long been an issue for clubs, forcing any involved in UEFA competition to spend a little more wisely than they’d perhaps like. Now the Premier League has a new watchdog on the block: PSR (profit and sustainability rules). This dictates that clubs must not lose more than £105m over the course of a three-year period. It’s hardly a new initiative, but with heavy losses sustained over the COVID-19 period, the rules were temporarily relaxed so it sort of filtered into the background.

We’re firmly out of that period now, though, and the first two clubs have been charged with breaches: Everton (twice, including a 10-point deduction) and Nottingham Forest. The other 18 Premier League sides no doubt decided to check and recheck their financial reports upon seeing that news, and if they were toying with the idea of one more signing, maybe decided to err on the side of caution. After all, a points deduction can be absolutely devastating.

So with clubs tightening the purse strings, the usual level of cash isn’t flowing through the sport. The knock-on effect of that — either down in the lower leagues of England or across Europe — is that clubs aren’t making big moves. Indeed COVID-19-hit clubs outside the Premier League even harder, to the point where they really need Premier League cash in order to make any transfers at all.

The hunter is now the hunted

Not only are Premier League clubs barely spending on arrivals, some are actually fending off interest in their own players.

Exemplifying this dynamic is Newcastle United, the richest club in the world under the ownership of Saudi Arabia’s Public Investment Fund, who despite a mounting injury crisis and Sandro Tonali’s 10-month gambling ban, don’t seem to have the flexibility to pull off any incomings — not even Kalvin Phillips on loan — and are battling to keep midfielder Bruno Guimarães and full-back Kieran Trippier.

It’s a very different scenario to two years ago, when they spent just under £100m on five players. And that’s a marker of just how different things are right now: Clubs from the continent are sensing an opportunity to raid the Premier League, rather than the other way around.

The Saudi project has faltered

Perhaps all of these issues would have been assuaged had the Saudi Pro League (SPL) continued its aggressive recruitment charge, which would have furnished European clubs’ pockets with more spending money. But, to date, Saudi Arabia’s most notable acquisition this month has been Marseille left-back Renan Lodi, who cost Al Hilal a fairly reasonable £20m to sign.

SPL clubs haven’t reignited the £150m chase to land Liverpool forward Mohamed Salah, set their sights on another of the game’s superstars like Kevin De Bruyne, or done much at all. In fact, they’ve been more concerned with keeping some of last summer’s high-profile acquisitions.

England midfielder Jordan Henderson’s extremely public U-turn was completed as he signed for Ajax from Al Ettifaq last week, Al Nassr defender Aymeric Laporte went on record to claim a lot of players were “dissatisfied” with working conditions and broken promises, while 2022 Ballon d’Or winner Karim Benzema’s tenuous relationship with Al Ittihad has led him to training individually and asking for a loan move this month.

These were huge signings for the Saudi Arabian league last summer, but the PR landscape has shifted now. Perhaps developments like this have made moving to Saudi Arabia a tougher sell for players this winter, or maybe Saudi Pro League director of football Michael Emenalo is simply biding his time. Whatever the case, the lack of moves to the SPL has greatly reduced the amount of January transfer activity we’ve seen so far.

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Loans are dominating

At the very least, the January transfer window has still served one of its classic purposes: providing beleaguered players with a chance to reset. The transfer window before a European Championship and Copa América often sparks these kinds of moves, and 2024 has delivered to some extent.

Jadon Sancho (Borussia Dortmund) and Donny van de Beek (Eintracht Frankfurt) have escaped their Manchester United torment, while Manchester City’s Phillips (West Ham), Liverpool’s Fabio Carvalho (Hull City), Tottenham’s Eric Dier (Bayern Munich) and Chelsea’s Ian Maatsen (Dortmund) are finally going to play some football.

Tottenham’s loan move for RB Leipzig’s Timo Werner was interesting as the Germany striker seeks to reignite his career, and players such as Emil Forsberg (New York Red Bulls) and Ivan Perisic (Hajduk Split) have called time on legendary careers at the top level. But while heartwarming to see, none of this will get the transfer juices truly flowing; so far it’s been low-cost stuff, loans and free transfers that don’t really move the needle.

The only really interesting permanent deals to date have been Tottenham’s move for Dragușin, Brighton’s £8m capture of Boca Juniors left-back Valentín Barco, and the club’s USMNT goalkeeper, Zak Steffen, heading to Colorado Rapids. Even moves for some of the world’s top young talent — Man City’s £12.5m signing of 18-year-old winger Claudio Echeverri from River Plate and Paris Saint-Germain’s €20m deal for midfielder Gabriel Moscardo from Corinthians — has seen them immediately loaned back.

Time will tell if the final week of the January window heats up, and the best hope of that is a top Premier League side panicking into a move on Deadline Day. But it’s probably safe to say there will be no late record-breaking transfer this time around.