Long-haul surge expected as pound weakens against European currencies

Long-haul surge expected as pound weakens against European currencies

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UK holidaymakers plan to travel further afield as the price of long-haul trips drop to compete with European breaks.

The growth in demand for long-haul travel comes as the pound suffers in value against European currencies, according to the latest Post Office Travel Money Holiday Money Index.

Sterling has slumped to a 22-month low against the euro and is significantly weaker than a year ago against most European currencies,

However, US dollar sales have surged by 14% in the first quarter of the year compared with the January to March period in 2015.

It suggests that holidaymakers are ignoring the fact that sterling is 3% weaker than a year ago against US dollar, possibly because they believe the US will be good value once they get there.

Andrew Brown, of Post Office Travel Money, said: “Sales of long-haul currencies are booming. 

“This suggests a move towards holidays further afield – especially as it is being reported that long-haul destinations are competing well on price with European ones, where package prices are rising.

“In the case of the USA, we believe some people who would have visited Egypt have swapped Sharm el-Sheikh for Florida. Prices in Orlando remain very attractive for families on a strict budget.”  

Sales of the Thai baht have increased by 17% year-on-year, indicating an awareness of the good value available in both holiday packages and prices in Thailand.

Phuket is rated by the Post Office as third cheapest among long haul resorts for a barometer basket of eight tourist staples, meaning that a family of four can have a meal with drinks for under £55. 

Prices in Bali and Cape Town are even cheaper, triggering a surge in sale of local currencies. The value of sterling has also risen by 19.3% year-on-year against the rand.

However, poor exchange rates do not always have a negative impact with Denmark emerging as a popular European destination,  fuelled by demand for Copenhagen city breaks.

Sterling is down over 9% on last April but sales of Danish kroner sales have soared by 52%.

Other city break destinations proving popular are Stockholm and Prague, despite a sterling rate fall of over 10% for currencies in both Sweden and the Czech Republic. 

Croatia is expected to gain further ground this summer despite the weak pound, which is worth around 10% less than a year ago. 

But concerns about safety in Turkey’s resorts and cities has depressed demand and Post Office lira sales have slipped by more than 50% to match the widely-reported big fall in demand for  packages to the country.


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