Sterling Nervously Treads Water Ahead of Key Scottish Independence Vote September 17th 2014 The Pound Sterling has remained mired in a mildly rising consolidation pattern just above its most depressed levels seen since November of last year, as forex traders square short positions and anxiously await polls, official statements and other indications about the likely outcome of the key Scottish Independence referendum vote scheduled for this coming Thursday.

The landmark popular vote will determine whether or not Scotland dissociates itself formally from the United Kingdom. This vote will bring to a head the independence debate that has raged within Scotland for more than a year after the referendum agreement was confirmed in June of 2013.

For both Scotland and the rest of the United Kingdom, a majority "yes" vote for independence in this public referendum could well result in considerable doubts about how the currently consolidated UK economy will fare without Scotland, and how Scotland will fare without the rest of the UK.

UK GBP Notes (PD)Major unknown factors about the referendum include whether or not Scotland's present currency — the Pound Sterling — will continue to be used by an independent Scotland, and this fact has made the forex market especially nervous. Compounding the volatility and perceived risk for the pound is that fact that projected results of voting opinion polls, such as those performed by YouGov, have recently swung back and forth between favoring Scotland remaining in the UK or becoming independent, thereby making the most likely outcome especially difficult to call.

Additional uncertainty has been expressed by analysts over how the Scottish health care system, its public pension plans, its taxation program and its television services will be handled independently from the United Kingdom after a successful yes vote. Another deep concern is how a separate Scotland will provide for the defense of its borders, and whether or not an independent Scotland will be welcomed by NATO or the European Union.

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