Holidaymakers hit as £1 falls

by Paul Conneally | December 31, 2008 at 01:14 am

79 views | 0 Recommendations | 0 comments

The pound has reached parity with the euro - thats one pound equals one euro - on many money markets and at some exchange offices the pound is coming in at under a euro.

Many Brits booked their winter holiday when the pound was much healthier against the euro and now face the prospect of skiing holidays where they are forced to cut back on the apres ski celebrations due to cost.

The UK travel industry has already reported slow uptake of bookings for 2009 and the year could see some big players making cutbacks and smaller ones going to the wall.

The knock on from this is for the overseas holiday resorts themselves who see much of their economy based on tourism. When the Brits don't come it means hard times for them too.

The plunging pound made one-to-one parity with the euro an expensive reality for British tourists yesterday, as the currency's slump deepened.

Thousands of skiers and holidaymakers heading for European resorts to celebrate the new year were feeling the pain in their pockets as the pound hit record lows against the single currency. On the markets the pound was still clinging to levels only a fraction above one-to-one with the euro.

On Bank of England figures, it closed in London at a low of €1.0199 - a value not seen since the euro's creation in 1999. Against the dollar the pound slid to a six-and-a-half year low of $1.4385 - compared with $1.99 six months ago. However, the pound's true euro value for travellers exchanging money was already well below parity, with typical tourist rates as low as €0.98. The Post Office was offering tourist rates yesterday of only €98.04 for every £100.