You’ve probably heard it and I’m going to reiterate it: the exchange rate is as favorable as it’s been in over a decade – it’s a great time to travel abroad! So think Ireland for St. Patrick’s Day – or anywhere else in Europe or other parts of the world.
Here’s why: When the dollar is strong, it means that it can be exchanged for a lot more units of another currency. As a general rule of thumb, things that cost $1 here cost €1 in Europe, or £1 in the UK. But when you purchase something for €1 you are really paying however many dollars equals that €1. Or if you buy something for £1, you’re spending however many dollars that equals. When the dollar is strong, you get more of the other currency for the $, or in the reverse, the other currency costs fewer $.
Case in point: the first time we went to Europe, the dollar was strong, with a $1 roughly equal to €1, so anything that cost €1 cost $1. A few years later, when we were living there, the dollar had significantly weakened, making it a less advantageous time to be there, at least financially. The € was then up to about $1.35, and the £ was almost $2. In effect, we paid about 1-1/2 to 2 times for everything we bought while we were there. (When we came home we went on a shopping spree – everything seemed so inexpensive!)
The dollar hit it’s low in 2008, but since that time, the exchange rate has dropped back in our favor. Today, €1 costs $1.06 and £ is $1.24 – about as close to par as it has been in over a decade.
You can eliminate the confusion by traveling only to countries that fix or “peg” their currency to the dollar. A few that could be fun to visit include Cuba, Hong Kong, and Panama.
But the most popular countries for visitors from the US, float their currency to reflect the economic conditions prevailing at a given time – so the exchange rate is important to the cost of your travels. To check current exchange rates, check out the CURRENCY link on my RESOURCES page.