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If you’ve been putting off a trip abroad because it’s too expensive, start packing your bags.
A stronger dollar has reduced the price of travel, from a hotel room to a glass of beer, in much of Europe, Japan, India and elsewhere.
“This is one of the best times for Americans to travel in years,” says Matt Kepnes, author of “How to Travel the World on $50 a Day” and other travel books.
Why the Dollar Is Strong
Other economies are shaky, making their currencies less valuable. Europe is barely growing. Japan is already officially in recession. China’s growth has slowed. Meanwhile, the U.S. economy has been chugging along, and the dollar has gained too. Many economists expect that steady U.S. growth will compel the Federal Reserve to raise interest rates later this year, making dollar investments more attractive and leading traders to sell other currencies and buy dollars.
What It Means
Let’s say that in June you had a charming dinner for two in Paris for 75 euros. First, congratulations. Second, it cost $103 then; today it would be $89. Expensive countries may not be cheap, but at least they’re more affordable now.
Thanks to the pound’s decline, England is cheaper than it was six months ago. But the euro has slumped more, making most of continental Europe an even better bargain. Travel writer Kepnes says Greece is attractive right now because hotels and tour operators have been slashing prices to fill rooms. The same thing is happening in Portugal and parts of Spain.
“Be the contrarian traveler,” Kepnes says. “If you want to go to Europe, consider eastern or central Europe, where prices are generally cheaper,” he says. He recommends going during the “shoulder season” — late spring or early fall — rather than in the peak summer season.
Demand for travel is so strong that most airlines don’t have to cut prices to sell seats.
“The summer fares are still very expensive,” says George Hobica, founder of travel website airfarewatchdog.com. But airlines might cut prices this spring if the strong dollar discourages Europeans and Asians from flying to and from the U.S.
Hobica recommends checking foreign airlines. He says Etihad, Qatar Airways, Turkish Airlines and others sometimes offer better prices to Europe than U.S. carriers do, although they could include a distant stopover.
AP Markets Writer Matthew Craft in New York contributed to this report.
You can reach David Koenig at http://twitter.com/airlinewriter