Summer surge in demand for long-haul currencies, reveals Post Office data

Summer surge in demand for long-haul currencies, reveals Post Office data

The surge in the value of sterling this year has prompted high demand from travellers for foreign currency for New Zealand, Australia and Japan this summer.

The continuing strength of the pound looks set to fuel heavy demand for winter trips as travellers respond to the value available, according to Post Office Travel Money.

The New Zealand dollar saw year-on-year sales growth of 56% in the June to August quarter, just at a time when the currency had weakened by more than 20% against the strong pound.

The same applied to the Australian dollar, which also weakened by a similar amount in recent months, with sales up by 39%.

The weak Japanese yen resulted in a 52% increase in summer sales of the currency coinciding with a 34% year-on-year rise in visitors reported by the country’s tourist office in July.

The Costa Rican colon tops the list of the Post Office fastest-growing currencies for 2015 to date with sales growth of 46% year-on-year ahead of Thomson launching Boeing 787 Dreamliner flights to the country this winter.

Currency sales rose by almost a third for the Indonesian rupiah, suggesting a buoyant time ahead for its most popular resort, Bali. Dubai has gained further ground against Middle East competitor Egypt and sales of its currency, the UAE dirham, have strengthened 22%.

Closer to home, city break destinations like the Czech Republic, Hungary and Russia also appear to have attracted more visitors.

While euro sales have been buoyant, Post Office Travel Money currency trends indicate that the big growth in demand has been for Eastern European currencies. Russia (ruble up 31%) and the Czech Republic (koruna up 22%) feature in sixth and ninth places in the summer growth chart while the Hungarian forint (up 22%) is the year’s eighth-placed bestselling currency.

Turkey suffered another disappointing summer and the Turkish lira was the only top currency to show a sizeable fall in demand. Ironically, the lira has now fallen to its lowest rate against sterling in over a decade, which means UK tourists visiting Turkey in the coming weeks can expect to receive over 30% more local currency for their pounds than a year ago.

Andrew Brown, of Post Office Travel Money, said: “The surge in sales we have seen for the Australian and New Zealand dollars is a clear indication holidaymakers are becoming increasingly astute and doing their homework to see when exchange rates are in their favour.

“These may not be the cheapest places to visit but they are among the world’s most aspirational destinations and the power of the pound provides a great incentive to make this the year to visit.”

He added: “Over the past five years sterling has strengthened by almost 50% against the yen and the extra cash in tourists’ pockets means that Japan should no longer be regarded only as a luxury destination.

“Better still, our latest barometer research reveals that local prices in Tokyo are down 25% as well.

“Cities like Prague and Budapest have a great reputation for value and we expect these to be popular short break destinations this autumn – especially for Christmas Markets visits.

“The Russian ruble has collapsed in value this year and is currently worth around 70% less than last September so Moscow and St Petersburg could also prove popular with adventurous holidaymakers.”

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