Currency experts warn the pound will hit £1 to €1 this year – here’s how to get the best travel money rate
Holidaymakers are being advised to buy half of their currency now and half closer to their break
HOLIDAYMAKERS jetting off to Europe this summer could be hit hard in the pocket with currency experts predicting that rates will dip below €1 for £1.
Some analysts are warning that the pound could lose value after next week's general election, making it more expensive to go on holiday.
Strategists from HSBC, David Bloom and Daragh Maher, have predicted that £1 will be worth just €1 and $1.20 for £1 by the end of the year, according to a note seen by Business Insider.
But the market exchange rate can vary from the rate offered by bureaux de change, meaning that British customers are likely to get even less than €1 for £1.
Some airport money exchanges already offer poor rates if you leave getting cash until you arrive at the airport.
Anyone exchanging cash today would get $1.26 and 1.13 euros for every £1 on travel website air.money, as long as it's ordered in advance.
How to get the best holiday money rate
WE spoke with Hannah Maundrell, editor-in-chief at money.co.uk to find out how you can guarantee the best rate:
- Don’t buy cash at the airport - you’ll always be able to beat the rate with a bit of forward planning
- Compare travel money companies online - Factor in delivery costs and choose the option that gives you the most cash to spend on holiday. If you’ve left it until the last minute order online for airport collection so you get the best of both worlds.
- Use comparison tools - MoneySavingExpert’s TravelMoneyMax enables you to compare pick-up and pre-order rates.
- Don’t pay for travel money with a credit card - it’s likely you’ll be charged a cash withdrawal fee which adds to the cost.
- Top up a prepaid card to lock in your rate now - Choose your card and read the T&Cs carefully as some apply hefty fees. WeSwap, FairFX and Caxton FX are all worth checking out.
- Always choose to pay in the local currency rather than sterling - This will help you avoid sneaky exchange fees.
But with the election just a week away, many have been left wondering what to do when it comes to holiday money ahead of the summer break.
Money experts believe that holidaymakers who are worried about the volatility of the pound should buy half their holiday money now and half closer to the time when they go on holiday.
Hannah Maundrell, editor-in-chief of money.co.uk said: “Comparing deals in advance will mean you get the best rate around at the time.
"Some currency companies let you pre-order your cash in advance then cancel if you don’t need it but be careful as your money won’t be protected.
If you’re worried then another way to hedge your bets is to get a prepaid travel card that lets you lock in a pre-set rate when you load your card; the downside is you could lose out if the value of the pound increases before you go away.
"An alternative is a credit card that gives you real-time exchange rates abroad and doesn’t charge fees.”
Sally Francis, senior writer at MoneySavingExpert.com said: "The reality is no one knows for certain what will happen to the pound after the election - some may accurately guess, but there's no certainty. Instead, ensure you're getting the best rates for your holiday cash when you go. If you've time, specialist credit cards are a good option as they don't add the usual 3% fee for spending in a different currency.
Ian Strafford-Taylor, CEO of travel money expert FairFX, previously told the Sun: “Any uncertainty surrounding political and economic events and announcements can have a negative impact on the pound and we’ve certainly seen that over the last 10 months.
Should you buy now or wait until the general election
THE Sun Online spoke to some currency experts to ask their views on what holidaymakers should do.
Editor in chief of money.co.uk Hannah Maundrell said holidaymakers who are worried about a volatile pound should buy half their holiday money now and half closer to the time.
“Trying to predict what will happen to the exchange rate is impossible.
"You never know which way currency will go so if you have a holiday booked perhaps buying half now and half closer the time means you won’t feel so bitter if it doesn’t go in your favour."
“When the pound moves in your favour and you’re happy with the rate on offer, it’s often a good idea to buy your travel money to lock-in that rate and protect yourself from any future volatility.”
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