QROPS update 28th February 2012 Pension Drawdown & QROPS and QNUPS

UK

Sterling continues to experience weakness from last week’s release of the BoE MPC minutes. GBP/EUR traded between a 1.1847 session high and 1.1783 low yesterday just steering clear of that 1.1755 10 week low seen last week but dangerously close to the critical 1.1764 level.

Against the US dollar sterling hasn’t been able to trade above the key resistance level, now at $1.5905, since Oct. 31 and hasn’t closed above it since Sept. 2. A failure to breach this level soon could lead to a weaker pound into Q2.

Yesterday cable kept it’s head above 1.58 following significant gains made over the weekend but steadily lost ground, dropping from a high of 1.5888 after the positive housing data from the US came out to the low of 1.5810.

Sterling lost massively against Aussie in Monday’s session, shedding over 1.4% from a high of 1.4891 to 1.4682. The pair stabilised to close at 1.4714. AUD made similar gains of 1.26% against USD and 1.5% against EUR.

 WORLDWIDE

Greece’s credit rating has been revised to Selective Default by S+P as a result of the Government revising the rules regarding private sector involvement (PSI). All private bondholders will now participate in the bond swap to help the Greek economy achieve its EUR130bn rescue package.

German decision makers have endorsed a second Greek bailout package with huge support in a 496/591 pro vote. Finland and the Netherlands will also be voting on the bailout package this week.

Germany released Gfk Consumer Confidence Survey early this morning and exceeded expectations for both;  YoY and MoM for January. Figures were 2.5% (consensus 1.8%) and 2.0% (consensus 1.8%) respectively.

Spain acknowledged it had fallen short of its 2011 budget deficit targets on Monday, achieving 8.51% of its GDP instead of the 8% cited by the new PM Mariano Rajoy in December.

EUR/USD all but reversed Friday’s dramatic push to 1.3485 yesterday. The pair opened at the day’s high of 1.3468 but by lunchtime had touched the low of 1.3366.

There are indications the U.S. economy is improving. The number of Americans signing contracts to buy previously owned homes in January rose 2 percent from the previous month and doubled forecasts.

Japanese Retail Trade figures MoM January were well up on consensus last night, beating the 1% projected with an actual figure of 4.7%.

The yen has plunged since the Bank of Japan, which has struggled against deflation, said on Feb. 14 that it would aim for 1 percent annual gains in consumer prices and would add 10 trillion yen to the economy.

 DATA RELEASES (GMT)