Difference Between Pound and Sterling

Pound vs. Sterling

Everyone is familiar with the currency of the United Kingdom, more commonly known as the pound. Sometimes, however, the word “sterling” is used to describe the UK currency. Are these two different things? Pound and sterling are used interchangeably in the United Kingdom, but is there really a difference between these two words used for the currency denomination?

The British pound is a type of currency, much like the euro for Spain and the dollar for the USA. The pound sterling, generally shortened to just ”pound,” is the certified currency of the United Kingdom, Tristan da Cunha, British Overseas Territories of South Georgia, the South Sandwich Islands, the Isle of Man, Channel Islands, and the British Antarctic Territory. Some say that the basis of this currency dates back to the Anglo-Saxon period. During this time, sterling was minted from silver. A pound of it consisted of 240 sterlings. Sizeable transactions were made through the exchange of pounds of sterlings.

The pound sterling is subdivided into 100 pence. It ranks as the number four most-traded currency in the world’s foreign exchange market, the first being the U.S. dollar, followed by the euro, and then the Japanese yen. These four currencies make up the basket of currencies for the calculation of the value of the IMF Special Drawing Rights. Sterling is number three under the global reserves.

The financial term used for the British pound is “pound sterling” (abbreviated to stg.). In formal contexts, the full, official name is used – pound sterling. The plural of this is pounds sterling. “Pound sterling” is also used when there is a need to distinguish the currency of the United Kingdom from that of other countries using the same currency. These currencies are: the Egyptian pound, the Lebanese pound, the Sudanese pound, and the Syrian pound. Under any other circumstances, the word “pound” is usually used. The pound is also recognized as the United Kingdom Pound. The British pound is used in more casual settings, and it is not considered to be the official name. Another slang term for the pound is the word “quid” (used in both the singular and plural context).

The word “sterling” (shortened to ster. or stg.) is used when “pound sterling” is abbreviated. It is the financial term used to stand for the currency. Usually, sterling is used in the wholesale financial markets, although not when it comes to describing actual amounts. For example, converting the sentence “Payment for this is accepted in sterling” to “Payment for this is five sterling” is wrong.

There really is no right or wrong usage of the words “pound” and “sterling.” Both are used all over the world and only differ depending on the circumstances. The United Kingdom currency is better known by the word “pound”, while “sterling” is used in the financial market. The pound sterling is the oldest currency currently being used in the world.

Summary:

1.The pound sterling, generally shortened to just ”pound,” is the certified currency of the United Kingdom.

2.Some say that the basis of this currency dates back to the Anglo-Saxon period.

3.Large transactions were made through the exchange of pounds of sterlings.

4.The pound is the fourth most-traded currency in the world’s foreign exchange market, the first being the U.S. dollar, followed by the euro, and then the Japanese yen.

5.The term “British pound” is used in more casual settings, and it is not considered to be the official name. Another slang term for the pound is the word “quid.”

6.The United Kingdom currency is better known by the word “pound”, while “sterling” is used in the financial market. The pound sterling is the oldest currency currently being used in the world.

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