It has been a quite day in terms of economic data releases but that didn't stop the pound losing more ground against the U.S. dollar. The GBP/USD cross fell to a fresh 10 month low this morning with the currency pair falling as low $1.6057 before staging a mini revival.
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The news has been dominated of late with the upcoming Scottish referendum and the uncertainty surrounding the potential breakup has caused the pounds value to fall dramatically in the past few days. Talk of a possible "Yes" vote contributed to the pounds demise again this morning with Sterling/dollar falling nearly a cent from $1.6150 to $1.6057.
The decline was short lived though and the pound managed to wipe away the days losses after a number of the UK's largest companies voiced their concerns over Scottish independence. Standard Life warned that in the event of a "Yes" vote they would shift large parts of its operations from Edinburgh to England, while BP also jumped on the band-wagon by backing comments from a key figure within the oil industry who said the Scots were being misled by predictions of a oil boom.
Will the pound drop further?
The uncertainty over the referendum is certainly causing a lot of volatility for all Sterling crosses at the moment and I am sure it will continue until the vote on the 18th. If we were to see a "Yes" vote the impact on the pound would be huge and I wouldn't be surprised if GBP/USD fell towards $1.50.
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