The Scottish government has denied performing a policy U-turn by asking UK regulators to oversee Scots banks in an independent Scotland.
The opposition said the move came following the SNP's previous criticism of UK industry controls on Scotland.
But a spokesman for First Minister Alex Salmond said the policy had now simply been "defined".
Scottish Finance Secretary John Swinney laid out his position during a speech in Glasgow on Monday evening.
He underlined a plan to keep a "sterling zone" and the UK regulatory framework, if the Scottish electorate voted for independence in the referendum, expected to take place in autumn 2014.
Addressing a business audience, Mr Swinney said a sterling zone would provide businesses in Scotland and the rest of the UK with the "certainty and stability for trade, investment and growth".
He added: "As the Bank of England takes on the role of regulator for UK financial services - a very sensible and long overdue position - retaining the pound will preserve the highly integrated UK financial services market.
"That framework is solid and substantial and I know that understanding our proposal is important to many of you in making your decisions about Scotland's future."
This is difficult stuff for SNP ministers.
Their rhetoric about the financial crisis has been about failed regulation from London being more significant than the failings of bankers in Scotland.
And even if John Swinney thinks the coalition government's reforms are welcome, it still looks like regulation from London.
And from London, it looks a bit presumptions that a Scottish government can assume the protection of institutions based in London.
But the nationalist view is that the Bank of England, being a central bank for the whole of the United Kingdom, is not the creature of Whitehall or of the rest of the UK, but of Scotland as well.
Likewise, the pound sterling is "as much Scotland's currency as it is the currency of England and Wales".
SNP policy favours an independent Scotland joining the Euro, pending a referendum, but the current economic conditions means the option is not currently attractive.
Ministers also said the Bank of England would continue to oversee monetary policy and set interest rates, but an independent Scotland could have a seat on its Monetary Policy Committee, or have a role in appointments.
Labour said the SNP had previously talked about an independent Scotland having its own financial watchdog and had pledged "light-touch regulation".
Scottish Labour leader Johann Lamont, said: "The SNP are making this up as they go along.
"The bank regulators they blamed for the collapse of the banking system are now the people they want to be in charge of the banking system. They reject the UK but want to keep George Osborne in charge of the banks?
"The truth is they know the people of Scotland reject leaving the UK, so they are now performing contortions on policy to make leaving the UK seem like remaining in it."
When asked what the point of independence would be if the SNP favoured keeping the pound and subscribe to London-based financial regulation, the spokesman for Mr Salmond said there was a "fundamental distinction" between monetary policy and fiscal policy.
He explained: "What fiscal policy provides you with is the levers of economic power in order to boost economic growth and increase employment in Scotland.
"No Westminster government has control over interest rates and has not done so since 1997, so, in that sense, it would be exactly the same as for successive Westminster governments."
The spokesman said independence would provide Scotland with a "strong voice" in Europe, adding: "Independence is the only constitutional policy which can ensure that we have the ability to remove trident nuclear weapons from the river Clyde - devo max doesn't provide that power.
“Start Quote
End Quote Sir Howard DaviesI don't quite know how you can be a servant of two masters, in terms of two separate treasuries and one central bank”
"Independence is the only constitutional option which can ensure that Scotland decides which military activities we are involved in in order that never again can Scotland be dragged into an illegal war such as Iraq."
The comments came as Sir Howard Davies, a former head of the Financial Services Authority, told BBC Radio's Good Morning Scotland programme that the SNP position to keep a central Bank of England and the pound was unclear.
He said: "It's not obvious quite how a system with two separate finance ministries and one central bank would work.
"Supposing the Bank of England looked again at a Scottish bank and said, 'it's really in trouble, people would want it to be rescued, but we're not going to rescue it unless we're indemnified', where would they look for that indemnity?
"It wouldn't be the UK Treasury, presumably the English Treasury - it would have to be the Scottish Treasury.
"I don't quite know how you can be a servant of two masters, in terms of two separate treasuries and one central bank. I can't think of an analogy where that's the case."
The Scottish government said it supported a key recommendation of the Vickers report into banking reform to remove the taxpayer from having to bail out troubled institutions in future.
Responding to Sir Howard's point, Scotland's deputy first minister, Nicola Sturgeon, said in the event of a Scottish bailout being needed: "The Scottish government, in that scenario, would pay the Bank of England to provide lender of last resort facilities for Scottish banks.
"The Scottish government has made clear, the SNP's made clear, that an independent Scotland would remain within sterling."
A Treasury spokesman said the Scottish government's proposals remained "totally unclear".
The spokesman said: "If they are proposing a full monetary union with Sterling, then the Eurozone crisis shows that strong control of monetary policy, fiscal policy and borrowing would have to be agreed with the UK government and exercised centrally.
"This includes the role of the Bank of England and the conduct of macro-prudential regulation.
"If they are proposing an independent Scotland using the pound but without a formal monetary union, the presumption is that the Bank of England would not be required to act as lender of last resort or take account of the Scottish economy when setting monetary policy."
Forex bureaus in Sudan hike exchange rate to curb black market - Sudan Tribune
June 11, 2012 (KHARTOUM) – Forex Bureaus in Sudan on Monday started using higher exchange rates for the US dollar in a bid to match its value in the black market and prevent further depreciation of the local currency.
Last month the Central Bank of Sudan (CBS) made a bold effort to curb the thriving black market by allowing Forex bureaus to buy and sell currencies using their own exchange rates as opposed to the official one.
The effort is hoped to bridge the huge gap between the official exchange rate and that used in the black market, where the US dollar continues to trade for twice the official rate of 2.7 Sudanese pounds despite multiple interventions by the central bank to inject hard currency.
Last week the Sudanese pound hit an all-time low of 5.55 in the black market as the central bank failed to supply Forex bureaus with enough hard currency to meet demands.
The secretary-general of the Forex Bureaus Union (FBU), Abdel Al-Moniem Nur Al-Deen, on Monday said that Forex bureaus had decided to hike their exchange rate to 5.53 pounds in the hope of greater proximity to the black market rate.
Nur Al-Deen justified their decision by saying that they had realized that the daily fixed quota of 3,500 USD allocated to Forex Bureaus by the central bank had been leaking to the black market through some traders who present fake travel documents in order to get dollars at the official rate then sell them back in the black market.
The FBU previously announced that some citizens applying for hard currency on travelling justifications have had their requests turned down after it was discovered that they were put up to it by black market traders who buy their dollars to sell them later at a higher rate.
Sudan has been struggling to contain the deteriorating value of its own currency as the flow of hard currency was sharply curtailed following the secession of the oil-rich South Sudan last year.
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Sudan's licensed forex traders further devalue pound - Reuters
KHARTOUM (Reuters) - Sudan's licensed foreign exchange bureaux have started trading Sudanese pounds at a rate nearly equal to the black market price, part of an effort started last month to stamp out unofficial trade, an official said on Tuesday.
Sudan has been facing soaring inflation and a depreciating currency since South Sudan seceded last year, taking about three quarters of the country's oil production with it.
Officials have kept the Sudanese pound's official rate at about 2.7 pounds to the dollar, but started allowing foreign exchange bureaux to trade at a rate of roughly 5 to the dollar last month to curb black market trade.
But the black market rate has remained higher than the devalued rate, continuing to draw many Sudanese eager to take advantage of the difference in the prices. A dollar bought 5.4 pounds on the black market on Monday, traders said.
Bureaux have now raised their rate to 5.48 pounds to the dollar to help close that gap, Abdel Moneim Nur al-Din, deputy head of Sudan's association of foreign exchange bureaux, said.
"We noticed a lot of traffic in the exchange bureaux," he said, adding people would buy from the licensed offices at the official rate and then "go directly to the black market".
The government has also allowed commercial banks to trade at a rate of around 4.9 pounds to the dollar.
The effective devaulation was aimed in part at drawing more foreign currency into the country from Sudanese living abroad.
Sudan was supposed to continue receiving some revenues from oil via fees paid by the landlocked South to export crude through pipelines running through the north, but the two have failed to set a price. Continued...
FOREX-Euro gains in volatile trade as risk aversion abates - Reuters
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Austrian finance minister Maria Fekter says Italy too may need bailout - Times of India
Maria Fekter's assessment of the eurozone's third largest economy amplified investors' fears that Europe is far from ending 2-1/2 years of turmoil.
A deal by euro zone finance ministers on Saturday to lend Spain up to 100 billion euros to recapitalise its banks was seen by many in the markets as yet another sticking plaster.
Eurozone rescue funds, already stretched by supporting Greece, Portugal, Ireland and soon Spain, might be insufficient to cope with Italy as well, Fekter said in a television interview on Monday night."Italy has to work its way out of its economic dilemma of very high deficits and debt, but of course it may be that, given the high rates Italy pays to refinance on markets, they too will need support," Fekter said.
She sought to soften her remarks on Tuesday, saying she had no indication Italy planned to apply for aid.
Italian Prime Minister Mario Monti said her remarks were "completely inappropriate" for an EU finance minister, and euro zone officials said they were deeply unhelpful.
Amid the cacophony, Italian and Spanish government 10-year bond yields rose further above 6 percent as the aid deal for Spanish banks failed to ease fears about Madrid's ability to fund itself.
The market reaction suggests that ministers have failed to break the so-called doom loop between rising government debt, economic recession and teetering banks that previously drove Greece, Ireland and Portugal into EU/IMF bailouts.
Analysts cited uncertainty about the mechanics of the Spanish rescue and fears that private bondholders could be pushed down the repayment chain below official lenders, risking losses in any debt write-down, as they suffered in Greece.
"Is this the next stage of a slippery slope in subordinating existing government bondholders?" asked Deutsche Bank strategist Jim Reid in a note to clients.
Investors are also worried about the outcome of a Greek general election next Sunday which may determine whether the country stays in the euro zone.
Credit ratings agency Fitch said the bank rescue may help stabilise Spain's sovereign rating, which it cut last week by three notches to BBB, and the bailout should not have a direct impact on other euro zone countries.
Even though Italy's deficit and unemployment are lower than Spain's and its banks are not exposed to a real estate crisis, doubts about Rome's ability to turn itself around during a deep recession are keeping international investors at bay.
If the economy does not start to grow after a decade of stagnation, it will face mounting difficulty in bringing down its debt, now at 120 percent of gross domestic product - second only to Greece's debt mountain in the euro zone.
Bank of Italy Governor Ignazio Visco said last week Italy's emergency is not over and pressed Monti to speed up reforms.
BANKING UNION
European Commission president Jose Manuel Barroso, European Central Bank policymaker Christian Noyer and French finance minister Pierre Moscovici all called on Tuesday for swift moves to create a euro zone banking union.
Barroso told the Financial Times that a cross-border banking supervisor, a deposit guarantee scheme and a bank resolution fund could be put in place in 2013 without changing EU treaties. EU paymaster Germany has so far rejected a deposit guarantee or a resolution fund, saying they would require treaty change.
The Bundesbank weighed in, saying a European banking union could bring advantages only if properly anchored in a fiscal union with powers to stop countries breaking budgetary rules.
Fekter's typically outspoken comments came after Italy's industry minister dismissed the idea that Rome may need external help, saying reforms adopted by his government so far had put the Italian economy on a sound footing.
Her concerns are shared by one of the German government's council of economic advisers, Lars Feld, who told Reuters that Italy could be next in line.
"Overcoming the troubles in Spain will bring calm to the markets for a while, but the chances are not so small that Italy may also come under fire, in particular as the promised labour market reform has turned out to be less ambitious," Feld said.
OUTSPOKEN
The Austrian minister has a track record of speaking out of turn or undiplomatically. She angered EU paymaster Germany last month by suggesting Greece might be forced out of the European Union over its economic problems.
She infuriated Eurogroup chairman Jean-Claude Juncker in March by rushing out to brief the media on a deal to increase the euro zone's financial firewall before he could make the official announcement. She later apologised.
And when US treasury secretary Timothy Geithner was invited to a euro zone finance ministers' meeting in Poland last year to plead for a more robust rescue fund, Fekter said bluntly that Washington should look after its own worse fiscal mess first.
In Brussels, EU officials privately voiced exasperation at her latest comments on Italy.
"The problem is that this is market sensitive," said a euro zone official, whose position does not authorise him to speak on the record. "It's one thing if journalists write this but quite another if a euro zone minister says it. Verbal discipline is very important but she doesn't seem to get that."
Italy's leading economic newspaper, Il Sole 24 Ore, appealed to Germany to save the single currency before it is too late.
"Schnell Frau Merkel! (Hurry Up Mrs Merkel!)," the usually sober business daily said in a banner headline in German.
An editorial urged Chancellor Angela Merkel to back guarantees for European bank deposits, allow direct access for banks to euro zone rescue funds and accept a mutualization of European public debts, with each country paying a different interest rates.
Merkel has opposed issuing joint euro zone bonds and says member states must agree to transfer more budget sovereignty to European institutions, including the EU's Court of Justice, as part of a political union before she would consider such idea.
An opinion poll published on Tuesday showed Italian confidence in the euro had plunged by 16 percentage points in two weeks as Spain's banking crisis and the looming Greek election test the single currency.
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