Currency union with Scotland rejection questioned

Key reasons put forward by the UK Government for rejecting a currency union with an independent Scotland are "unsubstantiated", an economics expert has said.

Chancellor George Osborne cited Treasury advice when he ruled out sharing the pound in this year's Scottish independence referendum, but the arguments "cannot withstand" scrutiny, according to Leslie Young, economics professor at the Cheung Kong Graduate School of Business in Beijing.

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The Scottish Government has put forward plans for the country to retain the pound if there is a Yes vote in September, arguing this would be to the benefit of both Scotland and the rest of the UK.

Professor Young said: "There may be good reasons for the UK to reject a currency union with an independent Scotland, but none can be found in the Treasury letter. Yet, that letter is the key justification for the stance of the UK Government."

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