The value of the pound has dipped amid the uncertainty of a hung parliament, just as many Brits prepare for their summer holidays abroad.
Following the result of the general election on June 8, the pound fell to $1.27 against the US dollar and €1.13 against the euro.
As the chart below shows, it has since failed to recover to its monthly high of $1.29 and €1.15.
Here, we suggest what holidaymakers can do to get the best deal on their travel money at this uncertain time.
Currency exchange: how to make the most of your money
Exchange rates are based on a number of factors, including political events, export figures and foreign investor sentiment.
Although the value of the pound traditionally drops in times of political instability, only to bounce back again, there’s no way to accurately predict what will happen in the future.
If you want to hedge your bets against the pound falling even further, you could try staggering your purchases. This could mean buying half of your holiday money now and the rest of it a little closer to the day of your trip.
How to find the best currency exchange provider
Not all bureaux de change will use the same money exchange rates or charging structures, so shop around for the best deal. Many providers offer better rates via their online currency exchange services than their in-person kiosks, so it’s worth checking these as well.
Avoid using currency exchange services at the airport. Our research has repeatedly shown that airport exchanges typically offer the worst rates on the market.
Find out more: buying travel money – more tips to help you get the best deal
Consider using credit cards or prepaid cards
There are plenty of credit cards that don’t charge foreign-loading fees when used abroad. Some won’t charge a fee for ATM withdrawals either. The exchange rates on these credit cards, set by the card issuer (Mastercard/Visa etc), are historically very competitive.
Alternatively, you could use a prepaid card. These are issued under the Visa and MasterCard network, and are widely accepted overseas. Many of these cards offer superior exchange rates to credit cards, although some will charge a fee every time you top-up or complete a transaction.
Find out more: prepaid card reviews – find a fantastic deal