Currency Exchange Continues To Concern Many Expats With Uk Pensions And Qrops-2

Currency Exchange Continues To Concern Many Expats With Uk Pensions And Qrops-2

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In conjunction with investment returns, currency exchange continues to concern many expats with UK Pensions and QROPS.
Continuing our daily look at factors affecting currencies allows 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.
Yesterday saw another fairly grim day for sterling as pressure caused by the uncertain fiscal situation weighed on the pound.
With the newly formed government yet to confirm a strategy to try and resolve the economic situation in the UK, the pound has suffered over the recently especially against the dollar, as investors avert from sterling investments and opt for the safe haven of the dollar.
However sterling made some initial gains after inflation data showed a rise to a 17- month high in April. The Office for National Statistics consumer price figure showed a 3.7% increase, up 0.3% from Marchs figure, which increased the chances of an earlier than expected interest rate increase. After this data sterling briefly touched $1.4522 against the dollar, and 1.1761 against the euro.
These gains were extremely short lived as the figures increased concerns that the potential for more monetary tightening combined with the imminent fiscal tightening could disrupt the economys recovery. Sterling quickly fell against the dollar, eventually touching a day low of $1.4367 and 1.1618 against the euro.
"April's UK consumer prices will fuel fears that the MPC might have to raise interest rates to quash price pressures just when the fiscal squeeze is about to hit the economy too," said Jonathan Loynes, chief European economist at Capital Economics.
BoE governor Mervyn King does however expect to see CPI fall considerably in the next two years, this comes after King was recently made to write a letter to the Chancellor to explain why inflation remained above the governments 3% target.
Next week the new coalition government are set to highlight the 6 billions of spending cuts which were discussed on Monday. The main worry is that the fiscal cuts on the horizon may stun the growth of the UK economy.
Finance minister George Osborne will announce his first budget on 22nd June, his main aim for the government is to use the spending cuts to reduce the UKs borrowing. This could provide support for sterling and provide a positive outlook for the medium to long term appreciation, but at the moment the uncertainty of the policies which are going to be put into place are weighing on sterling
Gerard Associates Ltd advises expats and people considering living abroad on the options available for Pensions, QROPS 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 reassurance and security of UK authorised and regulated advice.

About the Author:
Mark Warne is associated with Gerard associates. He is writing on HMRC QROPS, QROPS Pensions, qualifying recognised overseas pension, QROPS advice.



Article Originally Published On: http://www.articlesnatch.com


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