What does the value of sterling mean for our customers?
Even though sterling has dipped in the wake of recent stock market falls, its gains over the past three months mean our customers can at last look forward to seeing their cash stretch further on trips abroad. 80 per cent of the top 40 holiday currencies have fallen in value against the pound. But we’ve found that customers prepared to travel further afield will reap the biggest benefits from sterling’s surge.
The biggest cash bonus will be for customers visiting Caribbean all-inclusive family favorite, the Dominican Republic, whose peso has plunged 16.7 per cent year-on-year against the pound. This will give them almost £72 extra peso on a £500 currency transaction. In Costa Rica the colon has fallen almost as much – 16.6 per cent since last February (+£71).
Things are also looking up for those travelling to the USA and countries whose currencies are pegged to the US dollar. Holidaymakers visiting ‘dollar destinations’ like St Lucia, Antigua, Barbados, Dubai and Oman as well as the USA can expect their pounds to stretch between 11.5 per cent (Barbados) and 12 per cent (St Lucia and Antigua) further than a year ago after a sterling surge of five per cent over the past three months. This will give them up to £53 more cash to spend than a year ago when they change £500 into foreign currency.
The same cash bonanza applies for holidaymakers or friends and family visiting relatives ‘down under’ in the coming months. The pound is up 10 per cent year-on-year against the New Zealand dollar (£46 on a £500 exchange) and nine per cent (+£41) against the Australian dollar. This is a 23 per cent rise over the past five years and good news for those planning trips to Western Australia on the first direct flights from the UK from next month.
However, the position is patchier in Europe. Travellers to eurozone destinations will have almost £20 fewer in euros on a £500 currency transaction than a year ago and they will also have to pay more for meals, drinks and other staples than in 2017 in popular eurozone destinations. The Post Office’s latest Worldwide Holiday Costs Barometer found that prices have risen by 30 per cent in Portugal’s Algarve and 39 per cent in Spain’s Costa del Sol.