How to get the cheapest holiday as pound drops to two-year low

How to get the cheapest holiday as pound drops to two-year low

HOLIDAYMAKERS may want to think about the best way to buy their holiday cash as the pound has dropped to new lows against the dollar and the euro.
You can now get just $1.244 for £1 – a rate that hasn’t been this low in over two years since March 2017.
4 We round-up how holidaymakers can make their money go further – despite tumbling exchange ratesCredit: Getty – Contributor
And the euro isn’t faring much better as £1 will currently get you €1.11. The pound to euro exchange rate hasn’t fallen to these levels since December 2018.
Rates could also remain uncertain and even fall further given the current changing economic and political backdrop.
Michael Brown, a senior analyst at exchange firm CaxtonFX said: “Sterling lost ground against the euro yesterday, falling to a fresh six-month low.
“The pound’s fall came as political uncertainties and increased concerns over the UK’s economic health exerted downward pressure.
“Economic performance will be in focus today, with the release of May’s GDP figures and a weak outlook would likely exert further downward pressure.
“Looking to the month ahead, while the pound’s focus will remain squarely on the Westminster political bubble, global focus will largely centre on ongoing US-China trade relations.”
But Mr Brown thinks the outlook is better for the dollar. He said: “Sterling fell against the dollar yesterday to levels not seen in regular trading since April 2017, as a combination of fears over both a no-deal Brexit and potential economic contraction in the second quarter exerted pressure.
“Today’s focus centres on Fed Chair Mr Powell’s Congressional testimony, where markets will be looking for signs of the Fed’s next policy action, with a rate cut still seen as a near-certainty.
“Risks appear biased to the upside for the dollar, with a less-dovish Mr Powell, pushing back on a July rate cut, likely to result in the market repricing their monetary policy expectations and the dollar strengthening.”
So if you’re jetting off on holiday soon what should you do? Luckily, despite the low rates there are ways to save – we round-up what you need to know.Get half of your cash now and half nearer the time
Currency rates can fluctuate wildly and while we can try to predict what might happen, no-one knows for sure.
4 The pound has been tumbling against the euro since the start of the yearCredit:
One way to protect yourself from these changes in rates is to buy half of what you need now, and half nearer the time in the hope that rates improve by then.
If they don’t, at least you know half your cash was bought at a better rate. founder, Martin Lewis, explained: “If you’re nervous, hedge your bets.
“To do this, buy roughly half what you need at today’s best rate – whether in cash or on a prepaid card, and then for the rest just rely on the best rate on the day you spend.”Don’t buy cash at the airport
To get the top rates on cash, use a tool, such as TravelMoneyMax to find the exchange firm offering the best deals near you.
And never buy at the airport – you’re a captive customer and the rates will usually be far worse.
Andrew Hagger, a personal finance expert at Money Comms said: “4 per cent of people said they buy travel money on the day which often means buying at the airport and that’s the absolute worst place you can buy it.
“You could easily get 10 per cent less currency for your money because the exchange rates offered are so poor.”
4 The pound hasn’t been this low against the dollar since 2017Credit:
Emma Grimster, from price comparison website TravelSupermarket added: “By avoiding a last minute dash at the airport, holidaymakers can get the most from their travel money by planning ahead and purchasing their currency online.”Use a top travel credit card
Travel credit cards are another good way to spend abroad.
They typically don’t charge fees or interest on overseas purchases, but they may still charge you for taking cash out.
Our best buy is Santander’s Zero credit card, which has no fees on spending or cash withdrawals.
Just remember to always pay in the local currency rather than using the retailer’s conversion to pounds, which is usually a much pricier rate.
But just because you are using plastic abroad it doesn’t mean you don’t have to pay these credit cards off like you normally would.
Always pay off your balance before the end of the month with these cards to make sure that any money you saved isn’t wiped away by paying interest.
4 Holidaymakers should consider getting an overseas credit card to ensure they get the best exchange rateCredit: Getty – Contributor
For more on travel credit cards you can read our guide here.
To find out which cards you’re most likely to get accepted for, use a soft search on your credit file, such as MoneySavingExpert’s eligibility calculator, so that it doesn’t leave a mark.
Try pre-paid cards
An alternative to carrying cash around is to get a pre-paid card. These cards allow you to put a set amount of cash on the card at a fixed exchange rate.
So if the rate is good at the moment, you can put money on your card and it will stay that rate when you are on holiday.
WeSwap, FairFX and Caxton FX are all worth checking out.
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Just keep in mind that these cards can sometimes have hidden costs and charges so be sure to read the small print.
For more information, see our guide to when is the best time to exchange money for holidays, including euros, dollars and Turkish Lira?
And our guide to the pound to euro exchange rate and the best place to buy currency.
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