Beat the currency slump: 10 destinations where your pound will go further in 2019
British holidaymakers with an eye on exchange rates would be right to worry about how far their pounds will stretch if heading abroad next year. This week sterling hit a 20-month low against the dollar and slipped to just €1.10 against the euro. With more political uncertainty on the horizon, there are likely to be further slumps to come.
But there is hope yet, with the pound still performing well against currencies in some of the world’s most popular travel destinations, raising the prospect of good value getaways in 2019.
The pound is currently returning double the number of Argentinian pesos it was 12 months ago, for example, meaning travellers to the South American country receive £500 more of the local currency for every £1,000 exchanged compared to December last year.
Sterling is doing well, too, against the Turkish lira and Icelandic krona, earning visitors an additional £227 and £134 in the currencies, respectively.
“Currency should be a big deciding factor behind holiday planning,” said Ian Strafford-Taylor, the CEO of financial analysts FairFX. “By choosing a destination where the pound is performing well, the cost of accommodation, shopping and dining out will decrease, allowing you to see more of the world, for less.”
Sri Lanka, Uruguay and Nepal also make the top 10 for where the pound has improved most in the last 12 months.
Considering fluctuations over the last five years, the currency analysts have tipped both Argentina and Brazil in South America, Egypt, Zambia and Ghana in Africa, and Ukraine in Europe as offering the best value for Britons next year.
“The pyramids of Egypt are more affordable than ever, with the pound going 106 per cent further than it did five years ago,” FairFX said, “meaning an extra £514 for every £1,000 exchanged.”
“Those heading for the island of Madagascar will also benefit from an improved pound, up 27 per cent against the Malagasy ariary since 2013, equivalent to £214.”
Sterling is worth nearly four times as much in Argentina than it was five years ago, after the nation’s economy suffered a torrid year. Instability, too, in Ukraine and Turkey, means the pound is worth 167 per cent and 108 per cent more, respectively.
Strafford-Taylor says the unknown consequences of Brexit should motivate travellers to look to long-haul trips next year.
“March 2019 will see the UK officially leave the EU, and although a lot of uncertainty lies ahead, it’s likely there will be even more turbulence for the pound against the euro ,which could impact Brits planning traditional eurozone holidays,” he said.
“Holidaymakers should make 2019 the year they look further afield for their trip at destinations where the pound is performing stronger. By taking the opportunity to capitalise on currency improvements and test out long-haul and off the beaten track destinations they could find a new holiday favourite or experience a trip of a lifetime for a lot less.”
How to get the best for your money?
Our consumer travel expert Nick Trend offers five tips to take away with you next year.
1. Avoid airports
Do not rely on buying currency at the airport. You are part of a captive market. Rates are rarely competitive with those available on the high street.
2. Use credit cards, but carefully
Generally, paying by credit card gives you a better rate than paying by debit card or cash. But this advice doesn’t apply if you are not able to clear the balance each month. The interest you pay on that balance will only add to your costs.
3. Consider a currency card
Get a competitive bank or currency card. The best pre-paid varieties now offer excellent value. I use the Monzo card (monzo.com) which charges no fees (up to a limit), offers near “perfect” exchange rates (ie you aren’t stung by the difference between a buy and sell rate) and allows you to always keep the balance in sterling without having to convert into a specific currency in advance. Alternatively, Revolut is similar, or the Halifax Clarity card is one of the best value credit cards for using overseas (halifax.co.uk/travel).
4. Lean towards the local currency
If you are offered the choice between paying a card bill in sterling or the local currency, opt for the local currency. This option is being offered more and more often - both at restaurants, shops and hotels, and at cash points. It is highly unlikely that the vendor or their bank will offer you a rate on sterling which is better than you will get automatically from the card issuer.
5. Hold on to your cash
If travelling to the eurozone, or another country that you visit regularly, keep some cash in hand and take it home with you so that you have a small float to take with you next time you visit.
