October 23 2014 Latest news:
Adam Aiken, Editor
Friday, May 18, 2012
Economic good news has been in pretty short supply over the past few years, but there is at last a little bit of cheer for people looking to escape the gloomy British weather and head for the sun.
Businesses that rely on exports will not be grateful for the current strength of the pound, but millions of travellers will find themselves quids in when they leave these shores.
The euro’s woes have been well documented, and the pound is up nearly 9pc against the single currency over the past 12 months. This is making it significantly cheaper for many travellers.
“There’s a lot of uncertainty and volatility in currency exchange markets – no one can accurately predict what will happen with the pound and the euro in the next few weeks,” said Tom Johnson, head of online business at International Currency Exchange.
“But, from our data, it certainly seems that many British travellers have been stocking up on euros now for their summer trips.
“Online orders for the euro have increased 275pc on average, year on year, suggesting that holidaymakers are closely monitoring the currency markets.”
But it is not just in the eurozone where sterling is stretching further. According to the Post Office, which has published a report into exchange-rate fluctuations over the past year, about 80pc of the world’s currencies are now weaker against the pound than they were 12 months ago.
Someone changing up £500 before visiting Brazil today would get the equivalent of nearly £100 more in local currency to spend than this time last year, as the Brazilian real has slumped by about 25pc since last May.
Meanwhile, a UK traveller converting £500 into Mexican currency would get back nearly £70-worth of pesos more than a year ago.
Other currencies that have crashed against sterling include the South African rand, the Polish zloty, the Hungarian forint, the Czech koruna and the Turkish lira.
The pound has also strengthened against the Croatian, Danish, Bulgarian, Icelandic and Argentinean currencies.
“Although the increasing value of sterling against the euro has dominated the headlines, there are very few places where the pound is not packing a stronger punch this year,” said Andrew Brown, of Post Office Travel Money.
“Our advice is for people to keep a close eye on exchange rates for all the destinations they are considering so they can judge where they will get the best return on their money.”
Alex Lawson, senior broker at Moneycorp, said: “Everyone’s talking about how the pound is soaring against the euro, and that’s understandable given the continuing question marks over the single currency’s future.
“While the EU is by far the most popular overseas holiday destination for Brits, this euro vision is blinding people to some of the other opportunities that are arising from the strong pound.
“Sterling has gained against a number of other currencies in the last year and this shouldn’t be overlooked as people consider their holiday options.”
Mr Lawson pointed to particularly large rises against the Indian rupee, the Brazilian real and the South African rand, giving significantly more purchasing power to people heading to those countries.
The US dollar is one of the few currencies that has risen against the pound, with British visitors getting about 0.7pc fewer dollars for their pounds than a year ago, and there has been a 4pc drop for sterling against the Kenyan shilling.