If you're planning your summer holiday to Europe, you should benefit from a little extra cash in your pocket.
The pound has strengthened against the Euro in recent months, meaning you'll get more when you sort out your spending money before heading to the sun.
Foreign exchange rates constantly fluctuate, but at the time of writing, the pound is back to its strongest position in a year, with one pound equivalent to 1.172 euros. That means if you wanted to spend £500 on your holiday cash, you'd get €586 euros to take with you (less any exchange commission).
Compare that to last November, when the same £500 would get you €570. While we realise it's not a holiday-changing difference, every little counts and it might be enough to get you an extra meal out or more drinks to enjoy by the pool.
While the position is an improvement, the pound is yet to get back to the highs of early 2022, when, with the Euro at 1.209, your £500 would have exchanged to €604.50.
Why is the Pound Stronger?
Many factors can influence currency performance. As you might expect, the key driver is the economic outlook, coupled with how this compares to other countries or currency zones (like the Euro).
While the UK economy is still far from buoyant, and many people are still feeling the effects of the cost-of-living crisis, the situation is undoubtedly improving, reflected in the pound's positive run. Some key positive news to help in recent months includes:
- Inflation fell from a high of 11% in October last year to something approaching the Bank of England's 2% target (2.3% in April 2024)
- The prospect of interest rate cuts is on the horizon, with many expecting the current high of 5.25% to begin coming down later in the summer
- And significantly, any fears that the UK was heading into a deep recession were soon dispelled when it dipped briefly into recession but is now enjoying its best period of growth for two years. The economy growing by 0.6% between January and March 2024
Alpesh Paleja, the Lead Economist at the Confederation of British Industry, summarised the positive outlook as follows: "May's increase in retail sales adds to the swathe of data pointing to an improvement in activity over the near term. Falling inflation and continuing real wage growth will contribute to a healthier consumer outlook, in turn supporting the retail sector further."
But while this is seemingly all good news for your holiday spending money, whether you're heading to Spain, France or elsewhere in the Eurozone, things might not be so black and white.
Prices High Across Europe
Depending on where you're holidaying, you will find basics like food and drink are more expensive than previously. So, while you have a few extra euros in your pocket, you might not feel it when it comes to spending. The reason is that after the pandemic and the energy crisis caused by the war in Ukraine, inflation is still slightly higher in many larger European countries than in the UK, notably in Spain. This table gives the percentage figure according to the latest official statistics.
| Destination | Inflation rate (%) |
|---|---|
| France | 2.2 |
| UK | 2.3 |
| Germany | 2.4 |
| Eurozone average | 2.6 |
| Spain | 3.6 |
Plenty of news reports in May claimed that Brits visiting Spain were shocked by the rise in the cost of drinks since their last visit. Bars and restaurants blame national insurance increases and the price of raw materials for the price hikes.
Find the Best Holiday Currency Deal
As with most things, it pays to shop around when buying holiday money. Thankfully, compareholidaymoney.com removes the hassle, giving you prices from various outlets so you can make an informed choice.
If you want to buy euros, for example, you'll find over 15 outlets compared, from Travelex and Sainsbury's Bank to Waitrose, Tesco Bank and the Post Office. Simply make your choice and buy online.
FAQs
Should I get euros before going to Spain from the UK?
We always advise you to get your holiday currency in advance because you'll likely pay much more at the airport or pay a lot of commission from a cash machine abroad.
What is the best Euro rate today?
While a simple Google search will give you the current GBP/EUR exchange rate, you can do a simple price comparison search on compareholidaymoney.com to find the best available rates for your money, taking commission into account.
Is the pound getting stronger against the Euro?
Yes, at the time of writing. The official rate is currently 1.172 euros to the pound, up from 1.14 in November 2023.