A Q & A on The Euro Exchange Rates Crisis And Your Holiday Cash – Part 2

July 23rd, 2012

Following on from the previous article; here are some more useful questions and answers surrounding euro exchange rates and the best way to manage holiday finances during this period of instability within Europe.

Q. How do I go about getting the best rate?

A. Come to Best Exchange Rates UK, we offer the most competitive rates around and we also offer impartial advice on when to exchange to get the most out of your money – this is obviously a hugely important factor.

Q. How big a journey has the pound really been on?

A. 2008 was the last time anybody could even hope to clear €1.23 for their pound. This was when the pound was halfway down its freefall towards parity – when one pound equalled one euro! Recently sterling has begun to flourish against the euro; markets have reacted to the leftward swing in France and the political uncertainty in Greece. Which have all contributed to the resurrection of sterling and euro exchange rates.

Q. Is it best to grab the euro now whilst rates are good or is something better on the horizon?

A. The pound has been appreciating against the euro over the course of the last few months, by as much as €1.30 at its peak. The longer the euro debt crisis continues the more positive the outlook for euro exchange rates in favour of the pound. A whole host of political and economic international events could swing this situation ether way. The most sensible way to tackle exchanging your foreign currency would be to buy half now and wait until nearer the time to exchange the other half. Travel companies adopt this practise – it’s called partial hedging.

Q. Will strengthened sterling mean my holiday will effectively be cheaper?

A. When it comes to your day to day spending i.e. food and drink, yes it will cost you less, as you have exchanged at a favourable rate. However your holiday itself won’t cost any less because you have paid for it through UK tour operators. Tour operators have the right to surcharge travellers if sterling falls, but unfortunately this does not work the other way round. Any profit made by travel companies as result of them hedging currencies when booking holidays will be kept for them, as with any corporate entity.

Have a look at our real time euro exchange rates online, or call us for a chat about your foreign currency needs.