Pound boost for late winter holidaymakers

Image source, Getty Images

  • Author, Kevin Peachey
  • Role, Personal finance reporter

Holidaymakers lucky enough to travel into Europe during the February half-term holiday are getting an extra boost from the value of the pound.

Sterling is close to its highest level against the euro since the immediate aftermath of the EU referendum, with tourist rates also at recent highs.

The pound is fetching 鈧1.20 on the currency markets and more than 鈧1.17 in bureaus de change.

However, there are warnings that far worse rates are offered in airports.

Travel money company Equals said the worst airport deals saw tourists changing 拢500 getting 拢172 worth of euros less than the mid-market rate.

"Regardless of how the pound is performing, some airports are keeping the same margins and profiting off holidaymakers who have left it until the last minute," said Ian Strafford-Taylor, the company's chief executive.

"We are seeing rates offered by airport providers as poor as 34% lower than the market rate, meaning people are paying a hefty price for convenience."

The calculations are based on a comparison between travel money providers in airports and the mid-market rate - which is the rate seen on currency markets, but generally slightly more generous the rates available to tourists online or on the High Street.

There is still a wide disparity between on-the-day airport deals paying less than 鈧1 for 拢1, and buying currency in advance online. Many consumer commentators have urged holidaymakers to plan well ahead when thinking about changing holiday money.

The value of the pound improved initially after Rishi Sunak was announced as the new chancellor.

But at least one expert, Prof Costas Milas of the University of Liverpool's Management School, described it as an "extremely premature" rise.

This reveals the difficulty for travellers to predict future movements of the pound when considering when to change money ready for their summer holidays.