This week has seen the Sterling reach a seven-year peak against the euro leading currency specialists to advise that those travelling in the future get their holiday cash now and take advantage of the most competitive exchange rates in a long time.
The sterling has gone 14% up on the euro in the last year and this week a holidaymaker could receive Ä1.40 for each pound.
It is predicted to continue rising slightly over the next few weeks but the currency specialists are adamant that this will be short-lived and it will drop by the summer of this year. Furthermore, there is the additional variable of the general election, likely to cause uncertainty and contribute to a fall in the pound.
Thus, the experts are advising that potential travellers act sooner rather than later in order to get the most for their money. Data reveals that the average holiday within Europe has dropped from £511 to £433 over the course of this rise in the strength of the Sterling.
The explanation behind this phenomenon is largely down to the relatively encouraging economic state in Britain and the political instability and uncertainty in a lot of other areas of the European Union. Moreover, stock markets for Europe reached a zenith in the previous week meaning investors withdrew their cash which in turn led to a weakening of the euro.
The specialists are forecasting that by the summer the Euro will be at Ä1.30 against each pound which would see a Ä1000 costing potential holidaymakers from Britain £769 compared to the £714 that it would cost them at present.
If you are going to heed this advice then do look around on the internet and the High Street at currency establishments rather than going to the airport as they can end up costing 6% more. Additional considerations to take in are using a currency card abroad that is paid for already and also reserving your holiday money in advance and evading a number of commission charges.
Mark Bodega who works for HiFX, experts in currency matters, stated: ìThe last thing you may think about when booking a holiday is the strength of sterling against a countryís currency, but itís important to make the most of your money, especially now the pound has appreciated and could have a real effect on the cost of your holiday.î
The notion that holidaymakers should take advantage of the market now is a convincing one considering the uncertainty that is present over the near future. The general election is likely to have a negative effect on the strength of the sterling and the European markets are just as capricious at the moment.
An additional factor to take advantage of now is the fact that the stimulus programme recently introduced by the European Central Bank is not likely to immediately strengthen the Euro. Further to this, the huge uncertainty pertaining to the political turmoil in Greece is unlikely to wane in the near term as those members of the European Union look to hold the coalition together.