Scotland Rejects Independence, Pound Erases Gains

The Great Britain pound wiped out its earlier gains after the results of a referendum showed that people of Scotland decided to remain in the United Kingdom. The currency was rising previously as traders were counting exactly on this outcome.

Scotland rejected independence as 55 percent of the Scotsmen voted ‘no’ against 45 percent that voted ‘yes’. So why the pound has fallen even though Forex market participants were buying the currency earlier counting on exactly this result? Perhaps, traders were following the “buy the rumor, sell the fact” strategy. Or perhaps they turned attention to the state of the UK economy that may be hurt by the weakness of European economy.

GBP/USD slid from 1.6393 to 1.6340 as of 12:07 GMT today after jumping to 1.6524 earlier. GBP/JPY sank to 177.73 following the surge from 178.13 to 180.71.

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