Strong Dollar vs. Euro: Time to Book European Travel?

The US dollar has not been this strong in Europe for two decades.

Earlier this month, the euro reached parity with the dollar, falling to its lowest level since 2002 and at times just below a one-to-one exchange rate with the US currency.

Travel experts have differing views on whether now is a good time for tourists to visit European countries that use the euro as their currency. Some encourage tourists to take advantage of this opportunity, while others discourage it, recommending waiting until the fall when demand eases and airport disruptions ease.

Lee Thompson, the co-founder of group adventure travel company Flash Pack, told FOX Business that this is the best time to travel as tourist prices are likely to rise significantly in 2023 due to higher fuel costs, taxes and exchange rates.

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“The dollar is so strong against the euro and the pound sterling right now and it may never get that cheap again,” Thompson told FOX Business. “Travelling in 2023 is expected to be more expensive as hotels increase their prices significantly, so now is the best time to travel.”

Travelers queue for security at Heathrow Airport in London on June 22, 2022. (AP/Frank Augstein/Associated Press)

The dollar is rising mainly as the Federal Reserve is raising interest rates more aggressively than central banks elsewhere to cool off the hottest US inflation in four decades.

Clint Henderson, editor-in-chief of travel website The Points Guy, argued that while hotels and restaurants are more affordable due to the conversion rate, demand is still driving prices up.

“The problem is that demand in Europe is so high right now that prices are exceptionally high, much higher than before the pandemic,” Henderson told FOX Business.

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Any “gains you make from currency equivalence” are canceled out by the fact, according to Henderson, that prices are overall higher due to pent-up demand.

Those higher prices are one of the few reasons he suggests travelers should wait until the fall to travel to Europe.

Heathrow flights

Passengers queue at British Airways check-in desks in the departures area of ​​Terminal 5 at Heathrow Airport in London, May 17, 2021. (REUTERS/John Sibley/File Photo / Reuters)

“Staff levels are not where they should be everywhere, including hotels and airports,” Henderson said, adding that he had heard “tale after tale” about travel crises across Europe.

Certain airports, such as London’s Gatwick and Heathrow and Amsterdam’s Schiphol Airport, have urged airlines to limit flight numbers as they grapple with staffing issues and ongoing business disruptions.

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North American Airlines also wrote to Ireland’s transport chief, demanding urgent action to deal with “significant delays” at Dublin Airport.

If you want to travel immediately, places like the Caribbean, Colombia or Turkey are your best bets, as demand is lower and the dollar is even stronger against those currencies, according to Henderson.

Fox News’ Greg Norman and The Associated Press contributed to this report.

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