Scottish independence: Carney on Euro lessons for Scotland

Mark Carney, governor of the Bank of England, has urged the Scottish government to look at the experience of the Euro zone when contemplating a shared sterling currency zone in an independent Scotland.

Mr Carney said retaining sterling would need to be underpinned by having the correct financial institutions in place, otherwise: "Those risks have been clearly demonstrated in the Euro area over recent years with sovereign debt crises, financial fragmentation and large divergences in economic performance".

Addressing an audience in Edinburgh, Mr Carney went on: "It is likely that similar institutional arrangements will be necessary to support a monetary union between an independent Scotland and the rest of the United Kingdom."

First Minister Alex Salmond had earlier been in talks with Mr Carney and said he expected a "technocratic assessment" on the issue of currency, which would avoid any opinion on whether Scotland would be better or worse off in the event of a "yes" vote.