Expats with Non-Sterling Income Getting More Pounds for Their Money

Major currencies have gone up against the pound
Major currencies have gone up against the pound

In the wake of Brexit referendum last year the confidence in pound around the world dropped down considerably. The British currency lost in value against the majority of currencies over the past 12 months. The latest research from Lloyds Private Banking analysed the pound in relation to 60 main currencies in the world. The result showed that 56 of those currencies have gained value over sterling.

Overall, the pound has fallen by 11% against a trade-weighted basket of currencies over the past two years. Moreover, it lost almost a fifth of its value against nine major currencies.

It is bad news for those expats who have their income in sterling. British pensioners living in the EU, for example, saw their sterling income losing  13.3% of its buying power.

“Many British expats will be feeling the pinch; those with incomes in sterling such as pensioners are getting fewer pounds when converting their money. However, on the other end of the bargain, British expats living and working abroad and earning in foreign currencies are now getting more pounds for their money and they are seeing their spending power surge when they head back to the UK.”

Peter Reid, expatriate banking director at Lloyds Private Banking

Those working and living in Brazil, Russia and Iceland, for example, and receiving their earnings in pounds, saw their income decrease by 28.4%, 28.0% and 27.9% respectively.

British retirees in the USA felt the pinch as the pound fell by 17% against the US dollar. It was pound’s lowest year end level against the dollar since 1984. Consequently employed expats earning in dollars saw their buying power back at home grow. The same applies to those working in China as the Chinese renminbi grew 11% against pound.

However, it was a good year for those Brits who retired to Turkey and North Cyprus as pound grew 0.3% against Turkish lira.

From the Expat Network

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