It is understandable that many people are paying close attention to the exchange rate at the moment. Whether you have been able to squeeze in a last minute trip before the schools go back or you have been waiting for the schools to go back in order to grab a cheaper holiday, there are plenty of people looking to book a holiday at this time of year. There are many factors that you need to consider when looking for the right holiday. The resort, the weather, the hotel, what is on offer, how easy it is to get there and what sort of dates are available are all big factors to consider but when it comes to holidays, you really need to think about the cost of the trip.
Booking flights and the hotel is a big cost that you need to consider but you also need to factor in what you will spend when you are abroad and this is why the exchange rate is crucial. Sadly, if you are a British person heading to Europe, you will find that the exchange rate is doing you no favours at all at the moment. The pound is currently experiencing a 10 month low against the Euro, and this means that you get less for your money when you go abroad, which is definitely a depressing thought.
The pound may continue to dip
Sadly, worse may be to come. This comes on the heels of a currency strategist at Morgan Stanley, a US investment bank, suggesting that the Euro could move beyond when it comes to its relationship with the £. This has never happened before but with suggestions that it could occur in 2018, things are definitely bad when it comes to travellers leaving Britain and heading across the Channel to mainland Europe.
Of course, some currency exchanges have already broken through the parity level, offering less than one euro to the £, but this has never been the official rate. When that changes, you can guarantee that there will be many people concerned about their finances and of course, the whole Brexit situation will be discussed again.
This is great news for European tourists
Mind you, when it comes to currencies, a problem for one person is a positive opportunity for another people. The weak pound has led to many European travellers coming to the United Kingdom and in April of 2017, a total of 2.93 million visitors from the Eurozone came to the UK. This is up from the total of 2.499m from April 2016 and the high number of people coming through has been classed as a record.
The turning point for the £ against the Euro came the day after the European Referendum but it hasn’t been the only factor. There have been a number of issues of late which has seen the pound struggle while the euro has enjoyed a number of fortifying aspects of late. The combination of these events means that the pound has slipped down, and this has created the situation where UK holidaymakers are struggling to enjoy the spending power that they used to have when they would visit mainland Europe.
The political landscape in mainland Europe has settled in recent times and the National Front defeat in France has helped to strengthen the Euro currency. In the build-up to that election, there were genuine concerns about the far right gaining power, and the euro being abandoned, and this was represented in the strength of the currency. That never came to pass with the National Front losing out, and that has helped the euro currency to rebound since then.
If you are heading to mainland Europe, you should be looking forward to the trip rather than worrying about whether you will be able to pay for everything. Anyone needing a helping hand in the short term will find that assistance is available. It is not as though you should reach for a loan at every point but when it comes to dealing with deadlines and having available cash for what you want to do, a guarantor loan may be a sensible option.
The fact that the euro may well pass the pound is another worrying trend for life in modern Britain and the problems of the past few years may continue for many years to come.
Andrew Reilly is a freelance writer with a focus on news stories and consumer interest articles. He has been writing professionally for 9 years but has been writing for as long as he can care to remember. When Andrew isn’t sat behind a laptop or researching a story, he will be found watching a gig or a game of football.