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How will the Scottish Independence vote affect currency markets?

SCOTTISH INDEPENDENCE The ramifications for sterling SAXO CAPITAL MARKETS Scottish independence and money Should Scotland be an independent country? On September 18th, Scotland will vote on whether it should be an independent country or remain part of the United Kingdom. The vote is on a knife-edge. While a YouGov poll published on September 7 showed the 'Yes' campaign having a slender lead, the latest poll released on September 12 shows the 'No' vote , on 52%, narrowly ahead of the "Yes' vote on 48%. • NO • YES 100 (%) 80 61% 57% 53% 51% 52% 60 40 39% 43% 47% 49% 48% 20 AUG 07 AUG 17 AUG 27 SEP 06 Source: http://yougov.co.uk/news/2014/09/12/scotlands-yes-bandwagon-stalls/ The sudden tightening of opinion polls, with the 'No' vote only narrowly leading the 'Yes' vote, has rattled currency markets and saw the pound fall to a ten-month low against the US dollar on September 8. 1,68 1,66 1,64 • Sterling's exchange rate against the dollar 1,62 1,6 Source: Bloomberg markets data SEP 08 AUG 17 AUG 22 AUG 28 SEP 03 SEP 09 SEP 15 Would Scotland be economically better or worse off if it became an independent country? % Voters are also worried Personally would you be better or worse off financially if Scotland became an independent country? % that an independent Scotland would leave citizens and the 37% 48% 45% economy worse off. 21% Better off • Worse off Data for September 09-11 Source: http://yougov.co.uk/news/2014/09/12/scotlands-yes-bandwagon-stalls/ How could the vote affect GBPUSD? YES NO GBPUSD falls below GBPUSD bounces to 1.66 1.40 on 'Yes' vote win on 'No' vote win "A victory for the 'Yes' vote could lead to short-term mayhem. Sterling and UK gilts will come under severe pressure, with the distinct possibility that GBP suffers a fall in the range of 10% to 20% against the USD." Nick Beecroft – Senior Market Analyst at Saxo Bank "A victory for the 'No' vote would see the risks associated with independence vanish. GBPUSD would move back up to 1.66 as dollar strength continues to flourish due to expected rate hikes from the Federal Reserve. Nick Beecroft – Senior Market Analyst at Saxo Bank SOURCES: YouGov, Scotland's Bandwagon stalls: http://yougov.co.uk/news/2014/09/12/scotlands-yes-bandwagon-stalls/ Trading margin products can result in losses that exceed your initial deposit. This material should be considered as a marketing communication under the Financial Conduct Authority's rules. SCML makes no representation or warranty, or assumes no liability, for the accuracy or completeness of any information contained in in this communication. This infographic has been produced for information purposes only and should not be considered as investment advice. Saxo Capital Markets UK Limited authorised and regulated by the Financial Conduct Authority, Firm Reference Number 551422. Registered address: 26th Floor, 40 Bank Street, Canary Wharf, London E14 5DA. Company number 7413871.

How will the Scottish Independence vote affect currency markets?

shared by saxomarkets on Sep 20
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On the brink of Scotland voting ‘yes’ or ‘no’ for independence, financial markets have suddenly grown queasy. A ‘Yes’ vote at the Scottish Independence referendum will carve up the UK, bu...

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