Uncertainty about Scotland’s future within the UK has seen the pound fall to its lowest level in 10 months.
It fell 1% against the euro to 1.2480 euros, whilst in earlier trading it also fell 1% against the dollar to $1.6159, in contrast to last week where the sterling was trading at $1.66 against the dollar.
On Monday Westminster leaders will look to agree on an offer of more powers to Scotland, depending on whether they remain within the Union. The main efforts of the Westminster leaders are to prevent a yes vote in the referendum next week.
Scotland’s search for independence is greatly affecting Scottish-based firm’s performance in the stock market. Investors are believed to be considering the risk of voting in favour of Scottish independence and are waiting to see how any possible changes in Scottish currency could affect share prices.
Edinburgh based company Standard Life were the greatest fallers out of all Scottish firms on the stock market, falling 3%. Other big fallers included the Royal Bank of Scotland at 2.4%, Lloyds Banking Group at 2.7% and energy supplier SSE fell between 1.5% and 1.9%.
Scottish independence however is far from a certainty with the Sunday Times featuring a poll, out of those who have already made up their mind, 51% would leave the UK, compared to the 49% who would oppose independence.
Politicians believe that a formal currency union would be impossible, but there is still the possibility for Scotland to use the pound, or any other currency for that matter.
The United Kingdom will continue to suffer from the elevated cost of finance, unless uncertainties do not resolve themselves.
