In the infancy of my travels from 1998-2003, it was really pretty cheap to travel almost anywhere for Americans. We were enjoying the strength of the Dollar with a pretty good rate against all the major currencies with the exception of the British Pound. A strong Dollar means cheaper travel for Americans.
Back then in the “good old days” I was able to travel all around Europe getting extremely favorable exchange rates versus all the major then European currencies like the Peseta, Franc, Guilder, Mark and Lira. Then the Euro came into hard currency in 2002 and after an initial falter it steadily increased versus the Dollar and really ramped up in 2003-2004. That was the last time it was cheap for Americans to go to Europe.
Over the past 12 years of economic chaos all around the world with commodity and currency speculation through the roof; the emergence of China as an economic superpower; and the debt crisis that crippled Wall Street-it has been hard and expensive to travel with US Dollars.
But in the last few days, the Euro/Dollar exchange rate has gotten down to the $1.05 range, causing many investors to look for every way on how to get 1000 dollars fast to invest into the current plunge. This is a 12-year low for the Euro versus the Dollar or a high depending on which way you look at it.
With economic uncertainty in Europe moving forward with Euro-Member countries like Greece, Italy and Spain it is conceivable that the Euro will fall to parity or below with the Dollar for the first time since 2002-the initial year of the Euro. If the Euro falls through that support level then who knows how far it could fall. I won’t project where the price will go but what I do know for sure is this is a great time for Americans to travel and not just to Europe. (Reference: in Cannabis investieren)
I was recently up in Banff, Alberta, Canada and had an amazing dinner at a fancy chophouse at the Fairmont Banff Springs Hotel called 1888. The prices are in Canadian Dollars; which just a few years ago were more valuable than the US Dollar (this sent shockwaves of pride all through Canada). I remember thinking take 25% off the prices listed in the menu and it made it so much cheaper and easier to swallow!
The same went for my day of skiing at Sunshine Village or when I went Heli-Snowshoeing in Alberta. The prices I was paying were actually 25% lower than what Canadians pay. This was really the first time in years where I felt I was getting value for my Dollars.
The US Dollar has also spiked versus the Australian Dollar; which for a while was also stronger than the greenback. The inflation in Australia has been rampant over the past decade and while it’s still not cheap to go to Australia-it’s cheaper now than it has been in a long time.
The Dollar has also risen to a multi-year high versus the Japanese Yen and several other global currencies. The only one that holds steady is the British Pound which is hovering at a reasonable $1.49-much better than $2.15 5-6 years ago!
So a strong Dollar means cheaper travel for Americans and it’s pretty much across the board. If you’ve always wanted to go to Europe, Canada, Australia, Japan, etc. now is the time to lock in hotel rates, tours and activities as there’s no guarantees with currencies and with interest rates expected to rise in the US-who knows what will happen to the Dollar.
Those were the good old days before the euro
Ya they really were! In 2001 I flew to Paris just to buy Christmas presents bc the Franc was so cheap and I knew the euro was coming!
I don’t know much about what causes exchange rates to rise and fall but all I have to say is it’s about time! I have traveled to Europe 1-2 a years for several years for vacation and have felt like I overspent every time. You always needed to tack on 25-30% more so I couldn’t be happier. Hopefully it’ll be even lower when I go to Italy in June.
Rachael, yes been a brutal decade or so exchange wise! Really 2003 was last time it was decent and euro was already creeping up.
Good post and nice to know the old greenback is making a comeback versus the euro. They really have nobody to blame but themselves with all that Greece nonsense and high unemployment in Spain and Italy. I almost feel bad for Germany which is tough for me to say.
Gene, in 1998 I was going to college in London and took an economics class and learned about the forthcoming euro. I remember hearing the 11 initial countries, i.e. BAFFLING SIP as the acronym and G being for Greece and saying it was a bad idea. Greece was brought in for tourism only and never had an economy of note and the Drachma was a disaster. The Olympics crushed that economy in 2004 and never recovered plus the government is run by crooks/morons. Spain and Italy are another matter but yes I almost feel bad for Germany but not really!
Great news…now if airfares would just go down!
Truth!
Looking forward to welcome you to West Africa any time soon 🙂
Monique thanks…hope to come back soon!
You are right Lee. A strong dollar means most Americans can travel cheaply. Here in Ghana, there are lots of things travelers who have access to dollars can do because our currency the Ghana cedi can stand the strength of the U.S dollar. As an example, you can rent a comfortable two bedroom apartment with $ 100 per month. That depends on the location though.
The downside about everything is that the more unstable a country’s economy gets, the stronger the dollar gets because in most developing countries like mine the dollar is the chief currency for doing most transactions-particularly in the import and export arena. Keep up the good work man!