QROPS 10th November 2011 pension drawdown, flexible pensions QROPS and QNUPS

At Gerard Associates Ltd we continue our daily look at factors affecting markets and currencies allowing some insight into conditions affecting exchange rates.

Cash and income timing from a UK Pension income drawdown, flexible pensions or QROPS (Qualifying Recognised Overseas Pension Scheme) should be considered to maximise the Pension drawdown, QROPS and investment income taken.

Investment market volatility and currency exchange remains a challenge. The global economics are volatile and unprecedented in history. Currency exchange continues to concern expats with UK Pensions, income drawdown now including flexible pensions, a QROPS and QNUPS (Qualifying non UK Pension schemes).

IN THE UK

• Sterling climbs to its highest level since March against the Euro to hit a high of €1.1783 this morning as the single currency is sold off heavily due to concerns in Italy about their bond yield rising above 7%.
• GBP/USD declined with risk appetite to hit a low this morning of $1.5890 as investors seek the dollar as a safe haven with all the turmoil in Europe
• UK records its biggest ever trade deficit to date in September showing the difference between imports and exports was £9.8bn, the worst reading ever since data began in 1998
• Sterling benefits from its temporary safe haven status to strengthen against most currencies except the US dollar 
• Ex-Chancellor Alistair Darling said in an interview if the Eurozone crisis is not solved quickly he expects to see a break up by Christmas. The significance of this point is that it is the first time someone has specified a time scale. This was backed up this morning as rumours circulated that France and Germany have discussed an alternative to the euro, eliminating many of the weaker nations.

ELSEWHERE

• Euro crashes as Italian bond yields record their biggest one day rise since the launch of the euro amid fears investors had lost confidence in the third biggest debt market
• EUR/USD has hit a low this morning of 1.3483, as Italian 10 year bond yields rise nearly three quarters of a point to 7.48%, levels that many economists consider unsustainable. The yield is higher than Ireland and Portugal went bankrupt suggesting a bail out is necessary
• Italy’s Prime Ministers Silvio Berlusconi’s resignation had a mixed impact on the markets, initially when the rumours started a few days the euro strengthened because investors felt a new leader would help the vital austerity measures. When the announcements was made after losing his majority in parliament, fears regarding contagion forced the stock markets and the euro itself down further
• Political uncertainty in Italy remains however this morning a life line for the Euro from reports that a technical government in Italy could be established which would result in faster votes on new austerity measures 
• Australian dollar sold off heavily across the board as investors look for a safer option currency as well as investors speculating about a 50 basis point cut in December, causing GBP/AUD to hit a high of 1.5812 this morning
• Nordic currencies (SEK,NOK) are largely underperforming in the risk off move as their central banks adopt a lower interest rate stance forced by all the turbulence and uncertainty in Europe
• Overnight Asian stock markets followed yesterday falls in the Western markets as the Nikkei fell by nearly 3% and the Hang Seng over 5%

DATA TO LOOK OUT FOR (all times GMT)

• Key data release today is announcements from the Bank of England monetary policy meeting. Most are expecting to see no change to policy, leaving interest rates at hold and the asset purchase facility at £275bn after last month’s surprise rise by £75bn
• At 1.30 in the US, the Trade Balance for Sept is released, experts are suggesting the deficit may have widened to $46.1bn. This is followed by Initial and Continuing Jobless Claims and the Import Price Index.
• The US Monthly Budget Statement is released at 7.00pm for Oct, the US balance sheet is expected to show a fall to $-105bn

Gerard Associates Ltd advises UK residents, expats and people considering living abroad on the technical and currency options available for Pensions, pension income drawdown, flexible pensions, QROPS, QNUPS and investments in a clear format allowing all customers to make an informed choice. Our service encompasses Pension including QROPS and QNUPS and investments in a clear format allowing all customers to make an informed choice.

This with the reassurance and security of UK FSA authorised and regulated advice - essential for your security.