The Effect of the Scottish Vote on Sterling
As we get closer to the Scottish referendum, due this Thursday, the currency market has become even more volatile than usual with an unprecedented situation fast approaching and so much uncertainty still looming over the UK. The polls show that it is too close to call and many Scots are so undecided that some are saying they will wait until they are in the voting booth before they make their ultimate decision. This morning we have woken to the news that the three main political parties in the UK have written a “vow” which has been published on the front page of the Daily Record. In this ‘Vow’ all the parties state that should Scotland vote to stay then more power will be granted to the Scottish National Party and that more equitable sharing of resources will occur. Should the Scottish people like what they hear from the major political parties in Westminster and decide to vote No then it would remove the uncertainty currently weighing heavily over Great Britain and the Pound, however, if the No campaign is too little too late and the Scots leave the UK then we could see some major movement on the exchange rates this Friday when the official announcement is made and the uncertainty would build.
I would imagine that should Scotland leave we will have a lot of jawboning from the major political parties with the negotiations between Westminster and Scotland likely to take around 18 months while in the rest of the UK it is likely we will see the political parties blame each other for the break up of the UK, it would have a significant impact on next years general election and also could set a precedence for the likes of Wales to start considering a similar move.
With so many unanswered questions the next couple of days will be vital for any client looking to buy or sell currency so if you do need to make an international money transfer make sure you speak with one of our senior currency brokers here at Foreign Currency Direct plc today. Our team of experienced brokers will be happy to discuss the outlook in more detail while keeping you informed of any developments as they happen. You can call straight through to our trading floor for free on 0800 328 5884 or if calling from abroad call us on 0044 1494 725353 alternatively you can email me directly on email@example.com