In its first Holiday Money Index of 2020 measuring exchange rate movements and foreign currency sales, Post Office Travel Money has reported that demand for holiday money in July showed a positive recovery trend after the prolonged slump during lockdown. At the same time, sterling has held its value and is now worth more against all major holiday currencies than in August 2019.
In particular, the UK’s largest provider of foreign currency, accounting for one-in-four UK transactions, says that its sales of the euro are bouncing back after lockdown eased. As evidence of this, the Post Office said that euro purchases on its Travel Money Card in July surged to 10 times the level prior to the start of the lockdown period.
The euro heads Post Office Travel Money’s 20 top selling currencies for July covering countries on the government’s list of ‘safe’ destinations for UK travellers. There are two new entrants to that list: the Icelandic krona (20th) and Vietnamese dong, which has leapt into the top 10 for the first time in ninth place. Vietnam looks to have benefited from being the only Far Eastern beach destination named on the government list.
Exchange rates are likely to be a deciding factor. In its Exchange Rate Monitor analysis of rate movements, the Post Office found that sterling is stronger year-on-year against all 20 of the bestselling currencies whose countries are on the Government approved list.
For those holidaymakers who want to travel outside Europe, most of the Caribbean islands are on the government list. Their currencies are pegged to the US dollar and, with the recent plunge in the dollar’s value against sterling, visitors can expect significantly more cash for their pounds. In Jamaica, for example, sterling is currently worth 18.1% more than last August.
Post Office exchange rate analysis also reveals that sterling has recovered well from its 2020 low point going into lockdown in March. 80% of the top 20 currencies are stronger than in March, led by the Jamaican dollar, which has gained over 22% in value since then. In fact, all Caribbean currencies have seen double digit percentage growth.
The only currencies to fall in value since March were the Norwegian krone (-12.9%), Australian dollar (-10.2%), New Zealand dollar (-4.2%) and Czech koruna (-0.8%).
Nick Boden, head of travel money in Post Office said: “It is great news that Britons travelling abroad this summer will find the pound in their pocket stretches further than a year ago in all the major holiday destinations currently cleared for travel. We do recommend that people planning to travel abroad follow FCO advice carefully.”