QROPS updated 15th May 2013 Pension drawdown and QROPS & 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).

UK

With the Bank of England due to present its inflation forecast the pound lost ground against the euro for a third day in a row yesterday. GBPEUR opened at 1.1768, briefly climbed above the 1.18 level before dropping as low as 1.1748.The pair opened this morning at 1.1782.

The pound fell to three-week lows against the US dollar on Tuesday, as renewed concerns over the outlook for growth in the Eurozone weighed on demand for risk related assets. GBPUSD fell to 1.5248 during US morning trade, the pair's lowest since April 24; the pair subsequently consolidated at 1.5235, sliding 0.41%.

Forecasts from the CBI suggest Britain’s economy is back on the path to growth, with a 2% rise in GDP anticipated next year. The business group said its latest economic study showed a “more promising” picture but still warned of “clear challenges” to come at home and abroad.

Chancellor George Osborne today called on the European Union to “take the fight” to tax evaders and avoiders. He urged fellow finance ministers at talks in Brussels to back growing moves for global co-operation in tracking down vast amounts in unpaid taxes.

WORLDWIDE

In Europe, data showed that Eurozone industrial production in March rose a seasonally adjusted 1% from February. The euro, down roughly 1.4% against the US dollar in May, also found support earlier in the session from signs of a robust response to a Spanish debt sale. However investors remain cautious given that the region remains mired in a recession. EURUSD opened at 1.3020 but later dropped as low as 1.2893.

Any gains from the Industrial Production data were tempered by Germany's gauge of investor confidence, the ZEW, for May. The index, which measures investors' expectations for the upcoming six months, rose a meagre 0.1 point to 36.4, missing analyst expectations of an increase to 40.0.

The German economy expanded less than forecast in the first quarter of 2013, preliminary figures released by the Federal Statistical Office showed this morning. GDP grew 0.1% in the first quarter, after adjustment for price, seasonal and calendar variations. This was weaker than forecast for a 0.3% growth.

Figures released this morning showed France has fallen into recession, highlighting the challenge French President Francoise Hollande faces in fighting rising unemployment and controlling public finances. The second-largest economy in the Eurozone contracted 0.2% in the first three months of the year after a 0.2% decline in the final quarter of 2012.

A member of the US Federal Reserve's top monetary policy-making body called on Tuesday for halting by year's end bond purchases aimed at supporting the US economy. Charles Plosser, known for his conservative views, said in a speech in Stockholm that he expected to see the US economy grow 3.0% in 2013 and 2014, up from 2.2% last year.

US households cut their debt loads broadly during the first three months of 2013, a report from the Federal Reserve Bank of New York says. The bank reported Tuesday that total indebtedness fell by 1% from the previous quarter to $11.23 trillion.

The US dollar rallied against the Australian, Canadian and New Zealand currencies on Tuesday as commodity prices fell. AUDUSD traded at 0.9917 USD, lower than Monday's level around 0.9944 USD. NZDUSD fell to 0.8225 from 0.8253. And the greenback bought 1.0159 Canadian dollars in recent trade, higher than 1.0102 in late trade on Monday.

INTERBANK RATES (09.00 GMT)

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.

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