Pension transfer values fell to a new month-end low in May, the third consecutive monthly record.

XPS’s Group’s Transfer Value Index fell to £137,000 during the month, matching the mid-month low seen in April, although it had climbed to £139,000 by the end of May (see table).

The group said the decline reflected small increases in gilt yields across the month, while future inflation expectations have remained stable.

Pension transfer activity - the number of pensions being transferred as measured by XPS internal data – fell marginally in May to an annualised rate of 22 members in every 1,000 transferring their benefits to alternative arrangements.

Pension transfer activity has been falling steadily since 2017.

Helen Cavanagh, senior consultant, XPS Group, said: "For the third consecutive month, we’ve observed a new month end low for the Transfer Value Index, which reflects continued increases in gilts yields, coupled with greater stability in long term inflationary expectations.

“Despite this, transfer volumes have stabilised over the past few months at a higher level than observed earlier in the year, albeit is at a much lower level than prior to the 2022 mini budget, when observed transfer values were significantly higher.”

Transfer Watch over the past 12 months

Source: XPS Group – All data is at the end of each month. 

According to XPS Group's latest Scam Flag Index, 85% of cases reviewed by the XPS Scam Protection Service in May raised at least one scam warning flag, which was a small increase from the previous month.

Although still elevated, scam warning flags remain below the peak seen in 2022, following the introduction of the new transfer regime.