Holidaymakers heading to far-away destinations ‘will see cash stretch further’

By Vicky Shaw, Press Association Personal Finance Correspondent

Many holidaymakers heading abroad from the UK can look forward to their pounds stretching further compared with a year ago, research has found.

Sterling is now stronger year-on-year against 80% of the top 40 holiday currencies, Post Office Travel Money found.

Those prepared to travel further could reap the biggest benefits from the strengthening of sterling, the research suggests.

The biggest cash bonus in the study was found to be for those heading for the Dominican Republic, whose peso has plunged 16.7% year-on-year against the pound, giving UK travellers nearly £72 worth of extra peso on a £500 currency transaction.

In Costa Rica, the colon has fallen by 16.6% since February 2016, giving holidaymakers the equivalent of around £71 more for their £500.

Andrew Brown, Post Office head of travel money, said: “Every long-haul currency in our top 40 – except for the Malaysian ringgit – has fallen against sterling since last February and, with savvy travellers watching exchange rates carefully, there is good reason to believe that more of them will consider holidaying further afield this year.”

In Antigua the pound stretches 12% further than a year ago (Wesley Johnson/PA)

The situation is also improving for tourists travelling to the United States and countries whose currencies are pegged to the US dollar.

Holidaymakers visiting “dollar destinations” like St Lucia, Antigua, Barbados, Dubai and Oman as well as the United States can expect their pounds to stretch between 11.5% (Barbados) and 12% (St Lucia and Antigua) further than a year ago, according to the findings.

This will give them up to £53 more cash to spend than a year ago when they change £500 into foreign currency.

The pound is also up 10% year-on-year against the New Zealand dollar, giving the equivalent of an extra £46 on a £500 exchange compared with a year ago and up 9% or the equivalent of £41 on a £500 exchange against the Australian dollar.

But the position is patchier in Europe. Travellers to eurozone destinations face receiving nearly £20 fewer in euro on a £500 currency transaction than a year ago, the report found.

Meanwhile, the Turkish lira is 16.5% weaker against sterling than in February 2016.