QROPS update 19th September 2011 Pension drawdown & 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).

The national banks of five of the strongest economies; ECB, Fed, Bank of England, Bank of Japan

and SNB, have come together to release three month USD bonds into the Eurozone.

This is a last ditch attempt to restore confidence in the future of the single currency

which is shadowed with doubt. Analysts will note that recent swing low’s measured

very close to the 23.6% Fibonacci level.

Recent declarations from the SNB regarding the pegging of EUR/CHF at 1.200 have

stood their ground for the time being, finding support just above the mark.

The USD may shine through as the unlikely winner this week. Traders appear weary

of the low yielding markets such as JPY or CHF in expectation of a Japanese or Swiss

intervention. If recent efforts to reinstate faith in Greece and the other PIGS nations

are unsuccessful, something which is still a real possibility – it leaves the Dollar as a

viable option for profit hungry traders.

The momentum of the EUR/USD ran out today at 1.3495 following a swing high of

1.4551. It hit its low on the same day as the EUR/AUD cross which touched 1.2987.

Analysts noting that activity in the EUR/CAD and EUR/AUD appeared to “lead”

similar behaviour in the EUR/USD.

Sterling struggled in all major crosses except with AUD. The worst performances

were against the CAD and EUR with a smaller yet significant 10 pip drop against USD.

The RICS report on house pricing which gauges the health of the Britain’s property

industry, illustrated a 23% fall in August alone. CPI was published as forecast, at 4.5%

YOY for August. This usually begets a strong hawkish policy response but markets

have generally factored in the Bank of England’s extension of their 0.5% interest rate.

IN THE UK

• GPB/USD started low this morning at 1.5683 following some uncertain volatility on Friday.
• GBP/EUR benefitted from the Euros weak performance and reached 1.1438 from 1.1376.
• Rightmove house price survey released over night shows house prices rose 0.7% for the last month

ELSEWHERE

• IMF and EU have given Greece a list of 15 “non-negotiable” austerity measures to be achieved as a pre-requisite for the next instalment of bailout funds. This follows revelations by the Greek Finance Minister that their economy is expected to shrink by 5.5% this year.
• Eurozone Finance Minister meeting over the weekend ends with little positive information to report, US Treasury Secretary Tim Geithner urges EU leaders to take control of take control of rising debt.
• USD/CHF opened trading at 0.8815, about 60 pips up from Friday’s close price.
• EUR/USD opening the Asian session at 1.3680 this morning.
• Markets are still thinking an official Greek default is on the cards, some think it could be as early as tomorrow.
• German Chancellor faces more political problems as her party struggles for support.

DATA TO LOOK OUT FOR

• A very quiet day for data today, Eurozone Construction Output is released this morning and in NAHB Housing Market Index is published at 3.00pm for September.
• ECB member Weidmann testifies on the Eurozone debt crisis in front of EU parliament
• German Chancellor Merkel speaks at 12.30pm and 2.00pm.
• US President Obama will announce deficit reduction plan this afternoon at 3.30pm.

 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.