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Getting to Europe is cheaper this summer — but everything costs more when you're there
Getting to Europe is cheaper this summer — but everything costs more when you're there

Yahoo

time06-07-2025

  • Business
  • Yahoo

Getting to Europe is cheaper this summer — but everything costs more when you're there

A last-minute summer flight to London or Rome costs less than it did a year ago, but the good news ends at the customs checkpoint. U.S. travelers to the U.K. and Europe are finding their dollars don't go as far as they did just months ago. Exchange rates haven't been kind to Americans abroad this year. The dollar index — which tracks the greenback against a handful of other major currencies — has plunged 10.3% so far this year, its worst half-year performance since 1973, largely due to President Donald Trump's ongoing global trade war. While some analysts expect a partial rebound later this month, €1 now buys only about $0.85 today, versus $0.93 a year ago. In Britain, £1 fetches some $0.73, about 6 cents less than in early July 2024. Some of the currency swings have been quite recent. A ticket to a London play that cost £100, or about $135, at the beginning of June would cost $137 now. A three-night Barcelona hotel bill of €850, about $965 a month ago, will set you back $1,002 today. Fortunately, cheaper airfares are cushioning the blow. Tickets to Europe and Asia are down 10% and 13%, respectively, since last year at this time and have returned to pre-pandemic pricing, according to the booking platform Hopper. And travel experts at recently found some of the lowest-ever deals for certain flights to Sydney, Rio de Janeiro and Dublin this fall. Many consumers appear to be taking advantage of bargain tickets. Even as international travelers pull back on visiting the U.S., Americans are venturing abroad. Travel volumes among U.S. citizens returning home at major airports' passport control were up about 2% over the 28 days through June 21 since the same period a year ago, according to Tourism Economics, a market research firm. While budget considerations are affecting who's deciding to vacation abroad and how to spend when they do, consumer finance experts and travel industry analysts say broader economic uncertainty is playing a bigger role. 'If you're going to cancel an international trip, it's not going to be because of the dollar,' said Greg McBride, chief financial analyst at Bankrate. 'It's going to be because you're worried about getting laid off, you're worried about geopolitical issues, or don't have the money saved up and the only way to pay for it is to put it on the credit card and finance it at 20% interest.' For any travelers with heartburn over the weaker dollar, McBride noted that it 'still compares pretty favorably to levels we saw in 2021, and it's still better than pretty much anytime between 2003 and 2014.' Indeed, Tourism Economics found travel spending by U.S. residents abroad rose 8.6% in the first four months of the year from the same period a year earlier. 'This indicates continued U.S. outbound demand,' the firm said. While the economy and household finances always influence travel demand, 'today those factors are looking to have more of a negative impact than positive one,' said Nicki Zink, deputy head of industry analysis at the market research firm Morning Consult. In the group's recent survey, 31% of consumers said both the state of the U.S. economy and personal financial pressures are reducing their interest in leisure travel in the next three months, 'higher than any other factor we survey about,' said Zink. For its own part, the tourism market research firm Future Partners found 47% of American travelers are likely to venture abroad in the next 12 months, but 35% said uncertainty around U.S. policy changes had already caused them to reconsider or delay those plans. And in a NerdWallet survey last month, 11% of consumers said they'd scrapped international travel plans this year over global relations or economic uncertainty. Plenty of Americans are still packing their passports, though. Millennials, for example, 'are increasingly considering international destinations, despite the higher cost compared with domestic trips,' said Zink, adding that interest in destinations across South and Central America, the Caribbean and northern Europe have risen this year. Wealthy travelers are also still traveling with gusto, extending a trend that has intensified since the recovery from the pandemic. 'Our affluent clients are still going after those bucket-list adventures and once-in-a-lifetime experiences,' said Mandee Migliaccio, CEO of the New Jersey-based agency Stepping Out Travel Services. 'While they're definitely keeping an eye on the headlines, they typically won't change plans unless a destination really becomes unstable.' Migliaccio acknowledged she has seen some subtle shifts lately, with some clients asking to trim flight costs or deciding to skip a stop to keep things more efficient. 'It's not so much 'I can't go' as it is, 'How can I make this work for me?'' she said. 'People are being strategic, spending where it matters most, and opting for curated experiences over excess.' This article was originally published on

Milei's Foreign-Exchange Shakeup Has Brokers Moving Into Banking
Milei's Foreign-Exchange Shakeup Has Brokers Moving Into Banking

Bloomberg

time02-07-2025

  • Business
  • Bloomberg

Milei's Foreign-Exchange Shakeup Has Brokers Moving Into Banking

Argentina's brokerages are restructuring after President Javier Milei took away lucrative arbitrage opportunities that juiced their business when he rolled back capital controls. With more than 280 brokers operating in the Latin American country — a figure unmatched anywhere else in the region, according to local regulator CNV — competition has always been fierce. It's even more so now that exploiting the gap between the official and parallel exchange rates doesn't generate as much profit, and that banks can sell dollars now, too. By comparison, that far exceeds the number of brokers in Brazil, Mexico, Chile and Peru.

Taiwan Eases Rules to Help Insurers Cope With Currency Surge
Taiwan Eases Rules to Help Insurers Cope With Currency Surge

Bloomberg

time12-06-2025

  • Business
  • Bloomberg

Taiwan Eases Rules to Help Insurers Cope With Currency Surge

Taiwan regulators have moved to help the island's insurers deal with the impact of a recent surge in the local currency, which had left them with massive paper losses on their foreign holdings. Insurers will be allowed to use six-month average exchange rates when they calculate risk-based capital in their semi-annual reports, the Financial Supervisory Commission said in a statement. At present, insurers use the exchange rates of the final day of the reporting period.

From fraud protection to fee-free ATM withdrawals: seven top tips for managing holiday finances
From fraud protection to fee-free ATM withdrawals: seven top tips for managing holiday finances

The Guardian

time11-06-2025

  • Business
  • The Guardian

From fraud protection to fee-free ATM withdrawals: seven top tips for managing holiday finances

You might consider yourself a seasoned traveller, somebody who obsessively plans holidays down to fanatically pinned maps and destination-appropriate music playlists. But even the most globetrotting gadabout can fall prey to poor money management. Simple mistakes such as failing to gen up on exchange rates or pressing the wrong currency button on a foreign ATM can result in you leaking cash that could be spent splurging on a ritzier hotel room or trading in a beer for a jazzed-up martini. From using the best bank card to maximising reward benefits, here's how having a savvy approach to your money while overseas is the secret to stress-free travel. It's all too easy when sitting on the beach, piña colada in hand, to forget that every time you tap your debit card on that contactless terminal, you could be charged between 2.75% and 2.99% of the transaction value of whatever you're buying, depending on the card provider. Every coffee, every snack, every bus trip you pay for, it'll all mount up until you're left with a monster bill by the end of the holiday. The best option? Switching to a fee-free credit card such as the Barclaycard Rewards card*, which is 100% fee-free for purchases and ATM withdrawals. *Representative example. 28.9% APR representative (variable); purchase rate 28.9% p.a. (variable); based on a £1,200 credit limit. The approval of your application depends on financial circumstances and borrowing history, so do the terms you may be offered. The interest rates may differ from those shown. T&Cs apply. Holidays relax people. That's their USP. They offer a guard-lowering calm, making us brave enough to Macarena away until the small hours – but this also means we may share bank details over unsecured networks in hotel lobbies, or fail to notice somebody hovering over our shoulder, quietly taking down our card details. For your peace of mind, Barclays has fraud protection systems that are in place 24/7 to protect your account. If they spot something suspicious, you'll be alerted straight away. And if you misplace your card, you can freeze it in the app so that nobody can use it until you find it. Even better, if you report your card lost or stolen while you're abroad, Barclays will arrange for emergency cash to reach you within three days. They'll also send a replacement card to your home address. Ah, the wretched B-word. But allocating yourself a predetermined allowance each day will leave you with more money as your trip reaches its denouement, ensuring you end your vacay on a high note. A rough yardstick is to estimate how much you'll be spending on costs such as food, accommodation, transport and activities, and adding an extra 30% on for extras/emergencies. Then divide it by the number of travel days to arrive at a daily limit. Other belt-tightening measures include skipping lunch by filling your boots with the hotel breakfast buffet, seeking out street food, or scouring the reviews/social media to find a restaurant on the backstreets away from the tourist zones, which could slash your bill and deliver a much more authentic experience. To help you budget like a pro, set up a savings goal1 in the Barclays app1, or turn on the spending alert so you can stay on top of your balance at all times. Foreign holidays are rarely ever cashless experiences: having some local coins and notes is essential. However, charges at international ATMs can be eye-wateringly expensive: as high as £14.95 when taking out £250 on your credit card, according to a comparison site (tip: always select 'without conversion'). Sidestep that with a fee-free card such as the Barclaycard Rewards credit card*, where ATM withdrawals can be made without any extra fees. Also, never leave it until the last minute to get foreign currency from an airport bureau de change. The 'walk up' exchange rates at these desks tend to err on the pricey side: ordering the money you need online through your bank before travelling will be at much more wallet-friendly rates. Plus – if they're like Barclays – the cash could be delivered to your home free of charge2 too. *Representative example: 28.9% APR representative (variable); purchase rate 28.9% p.a. (variable); based on a £1,200 credit limit. The approval of your application depends on your financial circumstances and borrowing history, so do the terms you may be offered. The interest rates may differ from those shown. T&Cs apply. It's a dilemma we've all faced on holiday. After finishing dinner, the waiter brandishes a card reader, asking: 'Do you want to pay in local currency or pounds sterling?' Generally, the best advice is to pay or withdraw in the local currency, as it'll mean your UK bank will calculate the conversion rate. Opt to pay in pounds and the local bank will do the conversion – usually at less favourable rates. The safety net of travel insurance might make common sense (we've all read horror stories about British holidaymakers who failed to get it, then forked out thousands of pounds for a medically-assisted flight home, right?), but ploughing through endless comparison sites to find the right quote isn't fun. In many cases, it's best to take heed from experts. The Barclays Travel Plus Pack3 (£22.50 a month) was named a Which? Best Buy travel insurance in June 2024. The policy was lauded for its £10,000 missed departure cover and being one of the few policies to cover pandemics. As with all travel insurance, always check the details. Some policies may not include children or pre-existing medical conditions; others won't include extreme sports such as bungee jumping, parkour or tightrope-walking. Travelling to the EU or US this summer? Then consider Barclays travel wallet4 (available via the Barclays app5), which enables you to buy Euros and US dollars before travelling – which you can then spend with your regular debit card while away. Because you've purchased the currencies already, you'll enjoy fee-free transactions during your trip too6. Then, once you've arrived back home, you won't be saddled with lots of coins destined to end up in a drawer, because Barclays will buy back any foreign currency left over at 0% commission. To find out more about keeping on top of your travel finances with Barclays, visit 1 You must have a Barclays or Barclaycard account, have a mobile number and be aged 16 or over to use the Barclays app. Terms and conditions apply. 2 £2,500 is the maximum amount that can be ordered and delivered to an individual residential address in a 90-day period. Please note, you cannot exceed £5,000 per person within a 90-day period. 3 Terms, conditions, exclusions and eligibility criteria apply. You must have a Barclays current account, be 18 or over and hold this product for at least six months from the date of purchase – then you can cancel at any time. 4 T&Cs apply. You need to be 16 years or over to access this product or service using the app. 5 You must be 11 or over to use the app. T&Cs apply. 6 No transaction fees apply when paying with Euros and US dollars from your travel wallet. There is a 2.75% margin applied when purchasing your currency. If you pay in British pounds on your debit card while abroad, a transaction fee will still apply.

What Affects Exchange Rates?
What Affects Exchange Rates?

Telegraph

time03-06-2025

  • Business
  • Telegraph

What Affects Exchange Rates?

What are exchange rates? Exchange rates reflect how much of one currency you can get in exchange for another. For example, if the GBP/USD rate is 1.28, you'll receive $1.28 for every £1. Rates fluctuate constantly due to market forces and global events. Even small changes can make a big difference — especially if you're transferring a large sum or managing business costs abroad. Why do exchange rates change? Currency markets are notoriously unpredictable. Even when economic conditions appear stable, a sudden event — such as a policy announcement or geopolitical crisis — can shift rates in minutes. For example, as of May 2025, the pound has fluctuated 11% against the US dollar and 6% against the euro. The GBP/USD rate ranged from 1.3444 to 1.2099 — a shift that could affect a €500,000 property purchase by over £41,000 depending on timing.* Key factors that influence exchange rates 1. Economic uncertainty Confidence is a major driver. When the future of an economy looks uncertain — due to recession fears, weak data, or global instability — investors often move their money to 'safe-haven' currencies, reducing demand for weaker ones. 2. Political stability and performance A stable government tends to support a stronger currency. Political risk (such as surprise elections or policy changes) can shake investor confidence. When Donald Trump was elected in 2024, the dollar rose against a number of currencies, only to fall back when uncertainty around tariffs and other policies set in. 3. Inflation Moderate inflation can actually boost a currency if it leads central banks to raise interest rates. However, high or hyperinflation suggests economic weakness and often drives currency value down. 4. Government debt High national debt levels may raise concerns about fiscal sustainability, discouraging investment and putting downward pressure on a country's currency. 5. Interest rates Higher interest rates can attract foreign capital, increasing demand for a currency. For example, demand for the euro went down when the European Central Bank started cutting rates ahead of the Bank of England and the Federal Reserve. 6. Terms of trade (exports vs imports) A positive trade balance (more exports than imports) increases demand for a country's currency, helping it appreciate. A negative balance can have the opposite effect. 7. Central bank policy Actions by central banks (like the Bank of England, Federal Reserve, or ECB) — such as interest rate decisions, stimulus measures, or forward guidance — can move currency markets rapidly. How to manage the effects of currency movements Because it's impossible to predict exactly when and how exchange rates will change, many individuals and businesses look for ways to manage their exposure: Work with a currency specialist Unlike traditional banks, FX specialists like Moneycorp offer: Competitive exchange rates No transfer fees Tools to lock in rates or automate transfers Explore currency transfer services Use FX tools to plan ahead Forward contracts **: Lock in today's rate for a future payment (up to 2 years) Spot contracts: Make a quick exchange using the current market rate Market orders: Set a target rate and automatically exchange if it's reached A foreign exchange specialist can help you use these tools to your advantage, whether you're buying property abroad, paying international suppliers, or managing business payroll. FAQs How do exchange rate fluctuations affect my money? Even small rate changes can have a big impact on international money transfers, business costs, holiday budgets, and the value of foreign income or assets. For example, if you're buying a €500,000 property, a rate swing of 5 cents could cost (or save) over £20,000. Exchange rates can also influence: Imported goods prices (cars, electronics, food) UK companies selling abroad The value of your overseas pension or inheritance How does inflation affect exchange rates? Inflation can both increase or decrease a currency's value. If inflation is controlled and leads to higher interest rates, the currency might strengthen. But if inflation runs too high, it erodes purchasing power and may weaken the currency. What happens when the exchange rate increases? When your home currency strengthens, you can buy more of a foreign currency — which is helpful if you're travelling, importing goods, or transferring money abroad. However, if you're earning in a foreign currency or exporting goods, a stronger domestic currency might reduce the value of income or make exports less competitive. Why are exchange rates different at banks? Banks often apply a markup on the rate you see online and may charge transfer fees on top. FX specialists trade in larger volumes and often offer more competitive rates, tailored tools, and no extra fees. Make your money go further The Telegraph Media Group International Money Transfer Service, provided by Moneycorp, gives you access to competitive exchange rates in 120+ currencies, with zero transfer fees. You can: Open an account online in minutes Track market movements Get guidance from a personal relationship manager Access forward contracts and other FX tools Open an account today and gain peace of mind when making international payments. Related articles Currency exchange rates explained Receiving money from abroad Sending money abroad *Interbank rates sourced from Bloomberg. **Forward contracts may require a deposit Be aware of currency risk. None of the information contained in this article constitutes, nor should be construed as financial advice. TTT Moneycorp Limited (company number 738837) is registered in England. Its registered office is at Floor 5, Zig Zag Building, 70 Victoria Street, London, SW1E 6SQ. Moneycorp is a trading name of TTT Moneycorp Limited, which is authorised and regulated by the Financial Conduct Authority for the provision of payment services (firm reference number 308919). Date of approval 21/05/2025.

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