Pension Scheme Plans in UK - QROPS
We continue our daily look at factors affecting currencies allowing some insight into market conditions affecting exchange rates. Cash and income timing for UK Pensions and QROPS should be considered to maximise the Pension, QROPS and investment income and benefits taken.
Investment market volatility and currency exchange remains a challenge. Things are still very volatile and we are in unique global influencing territory. In conjunction with investment returns, currency exchange continues to concern many expats with UK Pensions, QROPS and now QNUPS.
Sterling continued to sit near a six-month high against the US dollar on Monday after last week's disappointing US employment data and speculation of return of Fed monetary policy easing but its gains were capped as dealers protected options barriers at $1.60.
Negative sentiment for the dollar continued due to speculation that the Federal Reserve may keep monetary policy accommodative to shore up the US economy. The US central bank started a policy meeting this week and releases their verdict later this evening.
By 2.30pm, sterling was up slightly on the day at $1.5960, after climbing as high as $1.5998 in early London trade, almost matching Friday's six-month high of $1.5999. The pound made around 0.3% against the euro climbing to €1.2050.
Option barriers at the key psychological barrier of $1.60 were attracting offers from Asian and US accounts, preventing further sterling gains. "There is a barrier at $1.60 and it looks well protected as $1.5999 was the high on Friday followed by $1.5998 today," said a London-based trader yesterday.
The latest CFTC positioning data shows speculators have stopped taking extreme short positions in the pound, returning to a largely neutral position in the past week. Analysts said that without the short position in the pound, the gains seen since June may dry up.
The euro peaked against the US dollar at around 10.00am hitting a session high of $1.3296 before falling throughout the day, just falling short of the $1.33 recently hit.
The dollar was stung by data on Friday which showed that overall US Non Farm Payrolls fell 131,000 in July, much more than the market had forecast. The data raised speculation that the Fed this week may reinvest proceeds from its purchases of mortgage-backed securities into Treasuries to help stimulate the economy.
Such a move would be seen as a sign the Fed is maintaining a loose monetary policy which may prompt more selling in the dollar.
Markets await figures on UK retail sales and the nation's employment sector this week as well as the Bank of England's quarterly inflation report due on Wednesday.
The central bank's latest price projections are likely to suggest more subdued growth over the next two years than in the previous report in May due to massive spending cuts announced by the new coalition government. But the inflation forecast may be significantly higher to account for a rise in VAT from next year. Such a view would add to the Bank of England's dilemma of how to control price pressures without undermining a still fragile recovery.
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 Pensions, investments, currency exchange and guidance on taxation in most popular 'sunnier' climates. This with the re-assurance and security of UK authorised and regulated advice - essential tools for your security.
Investment market volatility and currency exchange remains a challenge. Things are still very volatile and we are in unique global influencing territory. In conjunction with investment returns, currency exchange continues to concern many expats with UK Pensions, QROPS and now QNUPS.
Sterling continued to sit near a six-month high against the US dollar on Monday after last week's disappointing US employment data and speculation of return of Fed monetary policy easing but its gains were capped as dealers protected options barriers at $1.60.
Negative sentiment for the dollar continued due to speculation that the Federal Reserve may keep monetary policy accommodative to shore up the US economy. The US central bank started a policy meeting this week and releases their verdict later this evening.
By 2.30pm, sterling was up slightly on the day at $1.5960, after climbing as high as $1.5998 in early London trade, almost matching Friday's six-month high of $1.5999. The pound made around 0.3% against the euro climbing to €1.2050.
Option barriers at the key psychological barrier of $1.60 were attracting offers from Asian and US accounts, preventing further sterling gains. "There is a barrier at $1.60 and it looks well protected as $1.5999 was the high on Friday followed by $1.5998 today," said a London-based trader yesterday.
The latest CFTC positioning data shows speculators have stopped taking extreme short positions in the pound, returning to a largely neutral position in the past week. Analysts said that without the short position in the pound, the gains seen since June may dry up.
The euro peaked against the US dollar at around 10.00am hitting a session high of $1.3296 before falling throughout the day, just falling short of the $1.33 recently hit.
The dollar was stung by data on Friday which showed that overall US Non Farm Payrolls fell 131,000 in July, much more than the market had forecast. The data raised speculation that the Fed this week may reinvest proceeds from its purchases of mortgage-backed securities into Treasuries to help stimulate the economy.
Such a move would be seen as a sign the Fed is maintaining a loose monetary policy which may prompt more selling in the dollar.
Markets await figures on UK retail sales and the nation's employment sector this week as well as the Bank of England's quarterly inflation report due on Wednesday.
The central bank's latest price projections are likely to suggest more subdued growth over the next two years than in the previous report in May due to massive spending cuts announced by the new coalition government. But the inflation forecast may be significantly higher to account for a rise in VAT from next year. Such a view would add to the Bank of England's dilemma of how to control price pressures without undermining a still fragile recovery.
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 Pensions, investments, currency exchange and guidance on taxation in most popular 'sunnier' climates. This with the re-assurance and security of UK authorised and regulated advice - essential tools for your security.
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