QROPS updated 10th July 2012 Pension drawdown QROPS & QNUPS

• GBPEUR continued to trade above the psychological 1.25 level, opening at 1.2588 and closing the day comfortably at 1.2602. Earlier in the day GBPEUR hit a new three and a half year high of 1.2632 as investors grew increasingly concerned about the Eurozone debt crisis and bought sterling as an alternative to the euro.

• On the back of Bank of England Deputy Governor Paul Tucker testifying before the treasury select committee yesterday, the US dollar surprisingly lost some of the gains it made towards the end of last week rising from a low of 1.5473 and closing for the day at 1.5508.

• The BOE’s Paul Tucker is pushing back at Barclay’s ex-CEO Bob Diamond’s contention that the BOE instructed him to keep Libor low to avoid the appearance of a raging banking crisis. He also told MP’s yesterday that the FSA investigations should be extended to other self-certifying markets such as Gold and Oil.

WORLDWIDE

• EURUSD traded within a tight range yesterday; opening below Friday’s low at 1.2273 and struggled to break the 1.23, closing at 1.2298 in UK trading hours. The next significant resistance lies at 1.2360.

• Yesterday, ECB President Mario Draghi said that the recent slowdown in growth in the Eurozone as well as the weakening of inflationary pressures in the area induced the central bank to cut the main interest rate, as well as the deposit and lending rates by 25 basis points at their July monetary policy meeting.

• Finance ministers met yesterday and have proposed that the head of the Luxembourg central bank, Yves Mersch, should take a vacant board seat at the European Central Bank.

• The EU’s head, Juncker announced that ministers from the 17 Eurozone nations reached a tentative agreement after 9 hours of debating which includes a ‘first disbursement’ of €30bn for Spanish banks by the end of the month.

• The timing of the meeting was fortuitous as the yield on Spanish 10-year bonds auctioned yesterday exceeded the key level of 7%, which market experts consider unsustainable.

• In Greece the Greek coalition government has won a vote of confidence in Parliament as Prime Minister Samaras told reporters he plans to accelerate privatisations and bring forward much needed reforms to try and stall the slowdown of the economy.

• Disappointing economic news from the US, China and Japan have reduced appetite for the Australian dollar, which remains correlated with global growth. We saw sterling move from a low of 1.5167 to a high of the day at 1.5250 yesterday against AUD.

DATA RELEASES (GMT)

INTERBANK RATES (09.00 GMT)