Plans for a currency union between an independent Scotland and the rest of the UK have been dealt a major blow as all three of the main UK parties insisted they would not agree to such a deal.
In what could prove a key moment in the debate over Scotland's future, Chancellor George Osborne, his Labour shadow Ed Balls and Liberal Democrat Chief Secretary to the Treasury Danny Alexander all declared a formal currency union was "not going to happen".
Scottish First Minister Alex Salmond branded it a "concerted bid by a Tory-led Westminster establishment to bully and intimidate".
He wants a shared currency and has threatened to walk away from Scotland's share of the UK debt if he doesn't get it.
The Scottish Government has previously set out its blueprint for retaining the pound if people vote for independence, creating a "sterling zone" with the rest of the UK.
This plan has been endorsed by experts on the fiscal commission working group, set up by Mr Salmond, which concluded that keeping sterling as the currency in an independent Scotland would be "sensible" and an attractive choice for the rest of the UK.
Mr Osborne went to Edinburgh yesterday and declared: "If Scotland walks away from the UK, it walks away from the UK pound."
He said official advice from civil servants was that "they would not recommend a currency union to the government of the continuing UK".
Both Mr Balls and Mr Alexander also made clear they would not sign up to a formal currency union if Scots vote in favour of leaving the UK on September 18.
Mr Balls said: "Alex Salmond is saying to people that you can have independence and keep the pound and the Bank of England. That is not going to happen."
Scot Mr Alexander said it was "crystal clear a currency union would create unacceptable risks both for Scotland and the rest of the United Kingdom".
The Liberal Democrat rejected claims the "Westminster establishment" was trying to bully Scotland ahead of the referendum, saying: "This isn't bluff, or bullying, it's a statement of fact."
Mr Salmond hit back, saying: "This is a concerted bid by a Tory-led Westminster establishment to bully and intimidate – but their efforts to claim ownership of sterling will backfire spectacularly in terms of reaction from the people of Scotland, who know that the pound is as much theirs as it is George Osborne's.
"The reality is that a formal currency union with a shared sterling area is overwhelmingly in the rest of the UK's economic interests following a Yes vote, and the stance of any UK government will be very different the day after a Yes vote to the campaign rhetoric we are hearing now."
The Scottish First Minister added: "People in Scotland will not be fooled by the bluff, bluster and posturing of Osborne, Ed Balls and Danny Alexander."
Scotland is arguing for a shared currency with the rest of the UK following a Yes vote in the forthcoming referendum on independence.
This would mean Scotland would retain the pound but assume many other financial responsibilites such as raising taxes and targeting spending.
The leaders of the main UK political parties have all said that would not happen in the event of independence. An alternative is for an independent Scotland to introduce its own currency.