Last night, the Aussie dollar fell to its lowest level in two years and while all the boffins are debating why, Aussie travellers are figuring out whether to lock in their spending money now or hope the future will send an exchange rate in our favour.
“The AUD is expected to drop further, so if you are heading overseas shortly it’s worth considering grabbing your cash sooner rather than later to ensure you don’t forgo any more spending money than necessary,” General Manager for the Travel Money Group, Kelly Spencer, said.
But it depends where you’re going.
If you’re heading to the UK, it might be better to wait as long as possible to change money, some analysts expecting the British pound to weaken as negotiations intensify in the lead-up to March 29, 2019, when Britain will leave the European Union, SMH reported.
“Without a clear outline for the United Kingdom's future, the pound is likely to continue to weaken the closer it gets to the scheduled March 2019 deadline to leave the European Union," Patrick Liddy, head of foreign exchange at WorldFirst, a money exchange service, told the paper.
The euro too will see some volatility thanks in part to Italian budget negotiations says Joseph Capurso, currency strategist at the Commonwealth Bank, which according to him may help lift the Aussie dollar a little.
However, most experts think the Aussie dollar will continue to fall against the euro by the end of the year.
It’s also bad news for those planning a trip to the USA, with many economists expecting the Australian dollar to be worth less than the current US72¢ by the end of the year.
Shane Oliver, the chief economist at AMP Capital Investors, says there is a good chance the Australian dollar will continue to fall towards US70¢ and, perhaps, even into the high US60¢, SMH reported.
But Graham Cooke, insights manager at comparison site Finder, says there are some countries where the Australian dollar is buying more.
"Due to international sanctions and a difficult political climate, the value of the Russian Rouble has dropped significantly over the last year and one Australian dollar now buys about 50 Roubles, up from 46, 12 months ago," he says.
"The Aussie dollar will also buy more than twice as much Turkish lira than it did a year ago.”
And the other positive thing is that according to Travel Money Group’s Kelly Spencer, “If you have just returned from your trip overseas and have some leftover cash, you can cushion those post-holiday blues with some Aussie spending money. The low Aussie dollar means you will get more when selling it back to us in exchange for your foreign currency.”
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