Chris Towner, HiFX, comments on the Scottish referendum

Chris Towner, managing director of FX advisory services at foreign currency specialists HiFX, said: “After two weeks of increased GBP volatility we have seen Scotland vote to stay in the Union by 55.4% of the votes to 44.5%.

“Since rumours started that the yes vote had overtaken the no vote a couple of weeks ago, we have seen the market start to price in the uncertainty that an independent Scotland could bring.

“However over the last few days we have seen the market become more and more confident that Scotland would vote no to independence and we have seen sterling rally from its lows against the US dollar of 1.6050 to trade at 1.6500 in Asia and from levels below 1.2400 in GBP/EUR to trade in the 1.28’s.

“The rise in volatility led by this Scottish referendum was welcomed by the FX markets which had seen low levels in volatility over the summer trading season and just goes to show how uncertain events remain the key drivers in the financial markets. Now that we know the outcome of this vote, the market will look to when either the US or the UK will strike first and raise rates, as we will have a long time to wait until Scotland gets the opportunity to vote again on this subject of independence.”