Winners, losers of a weak dollar
CNN's Mallika Kapur
LONDON, England (CNN) --Stronger, weaker, multi-year lows and fresh highs. The currency market has fluctuated wildly in recent months but what do these movements mean for industry and consumers?
After years of strength, the dollar has slumped 14 percent against the British pound and 22 percent against the euro over the last year.
A strong currency is welcome news if you are heading out of Europe. But those coming to the region can find it expensive.
A ride on the London Eye costs £11, that's around $18 for a tourist from the United States -- 10 percent more than they would have paid last summer. For visitors from Germany, or elsewhere in Europe, the price is around 12 percent less than last May.
For Europeans choosing to vacation in the States, the timing could not be better.
"For Europeans, its become a bargain to fly to the U.S. It's become a much more attractive destination as a result. Of course, there are all sorts of other reasons not to travel at the moment, but the exchange rate does make it more attractive to go the U.S.," said Mark Cliffe of ING Financial Markets.
There are other upsides to a weak dollar, it allows U.S. manufacturers to sell more goods abroad and encourages overseas companies and tourists to spend more money in the States.
For example, a standard room at New York's Plaza hotel costs $239 this week, that's £150 for a British tourist. Last year, a comparable room would have cost £163, that means a saving of £13 this summer -- an extra bit of cash to spend in New York!
For those traveling in the opposite direction, there is good and bad news. The bad news is a weak dollar won't take you very far in Europe. The good news is, there are plenty of bargains.
"In any downturn in the economy, when we are seeing few travelers in London, there is heavier discounting taking place, on air fares or hotels, for tourists ... there's never been a better time to find a good deal," said Sam Hurst of TRI Hospitality Consulting.
The best deal could be a trip to Poland. The dollar has fallen by only five percent against the zloty since last year offering tourists the best bang for their buck. |
