Strong pound means travelling further for value, finds reportPosted: April 23, 2014
People may have to travel further to ensure the best spending power of the pound, according to an economic report.As sterling hit its highest value in five years, the pound has risen in value by 30% against the Turkish lira since April last year.
Other destinations offering attractive rates on holiday costs and spending money over the past year include South Africa and Australia where £1 buys 26% more rand and 23% more Australian dollars.
The US and Canada are also relatively less expensive in sterling terms.
The pound has risen in value against all of the 27 currencies on which data is collected by the Bank of England.
Martin Beck, senior economic advisor for independent economic forecasting group the Ernst & Young ITEM Club, which compiled the figures, said that sterling’s rise was good for holidaymakers but long-haul destinations were best.
He told the Times yesterday: “For those planning trips to Europe, the picture isn’t quite so favourable, with sterling up by a relatively modest 2.5% against the euro since last April.
“Looking ahead, sterling could rise further against the single currency, reflecting the UK economy’s relatively stronger growth prospects.”
But he added: “We also expect the pound to decline in value against the US dollar, with monetary policy set to tighten sooner than in the UK.
“This decline would tend to push down sterling’s value against currencies linked formally or informally to the dollar, including many emerging economies, or belonging to countries that trade heavily with the US, like Canada.”
The pound hit $1.6842 last week, its highest level since November 2009.
Sourced by Travel Weekly