The £! The rocket in your pocket at 1.09
As some pilots flap around over more pay for their 90-hour month and flight computers crash-land for summer … once again the great British getaway to the sun is being tripped up by things beyond the average family’s control.
But what appears to be worrying bruised and battered holidaymakers the most is the state of the pound in their pockets… in short most see the exchange rate as the final blow to the traditional two weeks in Torremolinos.
But is it? Or are we still better off spending our hard-earned dosh in sunnier climes?
The consumerwatchfoundation.com is keeping an eye on pound sterling and will report regularly here.
So, let’s begin at the beginning …certainly our wealth overseas has lessened and rates at the bureau de change are catastrophic at the moment.
But you have to accept that to some extent their rates – which are incredibly low compared to the money markets – reflect business costs like rent, staff AND having oodles of money available.
And if you buy your euros (for instance) at the airport, things are even worse.
But here is a hot tip from the BBC – they say, ‘the value of the pound is always reflected in the price of another currency’. The BBC suggests the best places to holiday for exchange rates are Turkey and Argentina.
However, there is no doubt that in the past handful of years the pound has had a rough time against the dollar and other currencies. The Brexit referendum saw sterling decline sharply in value.
And as the vote on the UK’s withdrawal deal from the European Union looms, further volatility is expected.
So, why does the pound go up and down like a whore’s drawers?
Well, since 1992, the pound has floated on currency markets and when the pound rises in value, more of the currency is being bought. When it goes down, more is being sold.
Jane Foley, senior currency strategist at Rabobank, says this: “A free-floating currency is a very good thing, because it works as a safety valve.
“The downside is when it comes on the back of political uncertainty,” she said. “Goods become more expensive.”
And in recent years, traders have been looking at politics, rather than economic data, which means faster trading, and a faster pace of change in the price.
“If you think abut political uncertainty being bad, the worst outcome is a hard Brexit,” says Ms Foley. This is because details of what will happen are scarce.
There is no doubt that Britain’s Brexit paralysis is dragging on markets and the pound has repeatedly found fresh lows but find the best way to exchange your pounds for euros – and there are many companies who can help.
MoneySavingExpert’s travel money website should be the first port of call, as it will tell you who’s doing the best currency deals, in real time. The very best rates are invariably to be had from a host of bureau de change based in central London. You pre-order on the firm’s website and turn up perhaps an hour or two later.