It’s the question on every thrifty holiday making Brit’s lips, or certainly those who tweet or contact consumer champion Martin Lewis anyway: “The pound’s been bouncing around the €1.40 mark, should I be buying Euros right now?”
Martin says: “This is a huge rate compared to this time last year when it was €1.20, or two years ago when it was €1.15. “The issue isn’t one of a strong pound, it’s more a weak Euro – on the back of increasing worries about deflation and lower interest rates in the Eurozone. The pound against the dollar is now at $1.50, when last year it was far better for holidaying at $1.70. Yet the weak euro is a boon for British holiday makers going to the Eurozone (Spain, France, Greece and the rest, but of course not Turkey), directly reducing the cost of fuel, eating out, day trips and more once there and indirectly reducing the cost of hotels, car hire and more.
Some need-to-know advice from Martin Lewis:
Should I be scooping up euros now? “Let me be blunt. I don’t know. Nor does anyone else. Currencies move – it could get better or worse, or stay the same. Even professional currency speculators don’t always get it right. Many commentators were saying to buy a few weeks ago when the euro was at €1.38, but it’s gone up then down since – and had you listened, you’d have lost out compared to the best price. “So take a step back from the daily market movements and think about your own circumstances. The euro rate for people in the UK right now is very good compared to the past few years, and would certainly mean your holiday spending will go much further than in recent years.” So it is a legitimate decision to say, “I want to bag the certainty of a high rate now, as that’ll be decent for my holiday”? Says Martin: “If you do, then do it with the mind-set that you won’t worry if the euro gets even weaker. This is all about whether the upside of ‘certainty’ outweighs the risk that you’ll look back with hindsight and say, “I should’ve waited.” Of course if the euro rate drops and you’ve locked in, you’re on a winner.
“My personal solution is to ignore market movements and just get the best rate each time you go. By far the top deals come via spending on a specialist overseas credit card - providing it’s repaid IN FULL each month, to avoid interest. Then in every country you get the same near perfect exchange rate banks do (normal debit and credit cards add a 3% fee onto this rate) smashing bureaux de change deals.
Top tip: To find the hotel you want to stay at always read reviews on www.tripadvisor.co.uk but always ignore the best and worst 10%.
More information at www.moneysavingexpert.com.