Currency and the purchase of your holiday money isn’t an area we provide regulated advice in but not surprisingly for all things financial, we do get asked when a good time to buy holiday money is when the country is preparing for potential changes in our exchange rate – like the General Election on June 8th.
So, if you have a holiday booked this year do you, or don’t you, buy your travel cash before the election?
The pound is still gloomy. Even after a slight bounce on the back of the election announcement, it will still only buy 1.19 euro or 1.30 US Dollar (as at 10/5/17) – it would buy $1.48 in June 2016!
But whilst you are dreaming of cocktails on the beach and want the best for your hard earned and long saved spending money, remember that currency moves are complex and whilst the election will provide more uncertainty, the exchange rate you get doesn’t only depend on what happens in the UK with Sterling.
Many factors affect currency movements and while an election brings uncertainty, that uncertainty is known and tends to be incorporated into the current price of the pound.
The truth is no-one really knows what will happen to the price of Sterling before or after the election and there will be as many people saying “buy now” as there are saying “wait till after the election”. In my opinion, I think that if you feel that 1.19 euro is a fair price buy your spending money now. You could hedge your bets and buy half now and half after the election (depending on when your holiday is of course) but with no real way of knowing what is going to happen. The most important thing is whenever you do decide to buy, put the fluctuations in the price of Sterling out of your mind, order a refreshing drink and soak up the rays!
Have a great a holiday!