Scottish independence could boost UK credit rating

Moody's said Scottish independence was “unlikely” to have any negative impact on the country’s credit and that the elimination of the sizeable fiscal transfers between the rest of Britain and Scotland could actually be a “credit positive”.

After publishing a number of reports into the impact of independence, the ratings agency became the first to say what credit rating Scotland would hold if it gained independence, saying it believed Scotland would likely hold an investment grade rating.

Moody’s added that a currency union with the rest of the UK would not be good for the Britain’s rating and that the adoption of its own currency would be the best outcome.

The ratings agency said:

“A potential currency union with the remainder of the UK would be credit negative if it were to materialise. However, cross-party opposition to such an outcome makes this unlikely."

"Scottish independence would eliminate the current fiscal transfers between Scotland and the remaining regions of the UK, marginally improving fiscal dynamics for the remainder of the UK given higher Scottish per capita public expenditures and Scotland's older demographic profile."