QROPS update 9th March 2011 Pension Foreign exchange 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 or QROPS (Qualifying Recognised Overseas Pension Scheme) should be considered to maximise the Pension, 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, QROPS and now QNUPS (Qualifying non UK Pension schemes).

Economic data was thin on the ground yesterday, however more significant data release is still to come this week, starting with Goods Trade Balance at 09.30.

In the UK we had RICS house price data earlier which showed that things outside London remain tough for the housing market. The effect of government spending cuts have not been fully realised yet and it could be a long time before regions beyond London and the South East can see any uplift in activity.

GBP/USD was flat to lower at around 1.6140 the bears were targeting 1.6110 and 1.6090 whereas the bulls held out for a test of near term resistance seen around 1.6240, which was previously support and the 1.6300 area.

GBP/EUR traded range-bound without any significant direction.

EUR/USD dipped slightly yesterday to sub 1.39 where there was some support expected but it was thought that a move lower might open up 1.3885 and 1.3835. To the upside the 1.4015 to 1.4040 area is seen as resistance and then 1.4100.

The Dollar was boosted by reports that more countries may step in to raise oil production and that Libyan leader Moammar Gadhafi may be looking for a way to step down.

Also on Tuesday, a report by a U.S. think tank stated that some Federal Reserve officials are calling for the central bank to drop language saying it expects to keep rates low for an "extended period" in the report to be released after its monetary-policy meeting next month.

Of the limited data out yesterday, official data showed that German factory orders rose “more than expected” in January, amid strong domestic demand.

In the world of commodities Gold suffered from the return to the dollar yesterday and swiftly rejected its highs after hitting another record above 1440.

Today in the UK we have the Goods Trade Balance announcements out at 09.30with the consensus expecting to see gains up to £-8.500B.

Summary:

IN THE UK

• RICS housing survey shows prices outside London continue to fall.
• The pound remained fairly range bound against the euro, peaking at high of €1.1641 and a low of €1.1579
• Against the US dollar trading was fairly flat, dropping half a cent during the session to end at $1.6150
• Northern Rock announces this morning it made a £232m loss in 2010
• This morning the UK Trade Balance narrows to -£7.057bn, better than expected and the pound sees marginal gains so far.

ELSEWHERE

• Euro rally falters as debt problems in periphery nations worry investors again, EUR/USD falls to $1.3851
• German Factory Orders rises to 2.9%, above consensus of 2.5% but the news does little to lift the euro.
• The dollar was helped as OPEC confirms more countries are able to up production to meet demand.
• As US and UK talk about “no fly zone” in Libya, we will test yesterday’s comments about how risk aversion is no longer the key currency mover.

DATA TO LOOK OUT FOR

• At 10.00am German Industrial Production paints a picture of Germany’s manufacturing conditions; a rise to 1.8% is expected.
• US MBA Mortgage Applications, the previous figure was -6.5% as applications fall, if this rises the dollar may see slight gains.
• RBA Governor Glenn Stevens addresses an Australian business lunch in Europe; investors will look for any comments that may reveal the central banks stance moving forward.
• US Treasury’s Geithner speaks this evening at 6.30pm, again his comments will be scrutinised for clues on upcoming policies.
• New Zealand policymakers decide on interest rates at 8.00pm, they are expected to drop to 2.75% to help economy after recent earthquake.  
• 4^th  quarter GDP figures are released in Japan at 11.50pm

 Gerard Associates Ltd advises expats and people considering living abroad on the technical and currency options available for 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.

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