Pension Protection Planning

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).

On Friday sterling was given a helping hand to pare losses made the previous afternoon after positive producer price index data rose twice as fast as expected in September. It also goes some way to reduce expectations the bank of England will need to add extra stimulus to the economy in the form of quantitative easing.

“At the margin, the producer price data make the Bank of England Monetary Policy

Committee more reluctant to revive quantitative easing in the near term at least, although the key factor on this will be just how much growth slows and how tight credit conditions remain,” said Economist at HIS Global Insight.

In Thursdays Asian trading the pound traded fairly steady against the euro at the five month low of euro1.1361 level but after the data managed to push through the euro1.14 mark to eventually hit the day’s high of euro1.1466.

Against the dollar sterling fell from the 8 month high of $ 1.6017 achieved on Thursday to reach the day’s low of $ 1.5825 before ending the day’s trading near the high of $ 1.5952.

“Sterling clearly wasn’t comfortable above $ 1.60 and I think it will struggle to get back above,” said currency strategist at Lloyds Banking Group.

Elsewhere the dollar continued to feel the pressure after weak US payrolls data increased market views that the FED would increase their asset buying policy within the next few months. The data showed employment fell by 95,000 in September and private hiring slowed.

“The weak U.S. numbers saw the yen, euro and sterling all rise against the dollar,” said strategist at Monument Securities.

“But the pound will struggle as risks of quantitative easing will weigh and once investors are done with selling the U.S. dollar they could turn to sterling.”

The euro also made losses after Eurogroup Chairman Jean-Claude Juncker said the euro was currently too strong, he said he was not happy with the euro’s rise to $ 1.40 against the dollar. This followed on from Trichet’s comments made the previous day that they hoped for a stronger dollar overall.

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.

This with the reassurance and security of UK FSA authorised and regulated advice – essential for your security.