Europe still a holiday contender as pound pulls back

Holidaymakers planning trips to Europe may find the pound in their pocket stretching further than they thought because the euro has fallen in value against sterling by over seven per cent since late December - bringing many other European currencies with it.

The sterling boost means that European destinations fill six of the top ten places in the new Worldwide Holiday Costs Barometer of tourist items in 27 countries, researched by Post Office Travel Services.

As sterling recovers from its December doldrums, the Post Office report, from the UK's largest foreign exchange provider, identifies the best value holiday hotspots in Europe and further afield, based on the rising exchange rate and local tourist costs.

Cheapest of all are Hungary and the Czech Republic, which will make Budapest and Prague good city choices for UK tourists taking short breaks. For longer stays Turkey, Bulgaria and Croatia are cheaper than any of the eurozone countries, although Spain has made it into the top ten lowest-priced destinations in the Post Office barometer. Key eurozone destinations like Greece and France are also looking more competitive.

South Africa looks an unbeatable option for long haul tourists this year. The latest Post Office comparison of currency movements reveals that the rand is now worth over eight per cent less than a year ago and this means that the shopping basket of tourist staples is the fourth cheapest in the table of 27 countries.

Kenya is another Post Office Holiday Money Report hotspot for 2009 because sterling has dropped significantly less against the shilling than against currencies for other longer haul destinations including Eygpt, the USA and Thailand. A combination of hotel and flight discounts and the low tourist costs make the destination an attractive prospect.

Andrew Spice of Post Office Travel Services said: "UK holidaymakers will be checking prices carefully this year and this means that the winning destinations will be those that offer good value not just for flights and accommodation, but for tourist staples like meals out and drinks."

"Exchange rates are still unpredictable and it will pay people to keep a watchful eye on movements as well as considering easy ways to save themselves money. By purchasing commission-free currency before leaving on holiday, UK travellers will avoid paying higher charges at airports and overseas at ATMs."

The Post Office Holiday Money Report also reveals a significant increase - 63.5 per cent - in the use of the Post Office Travel Money Card over the past year and pre-paid cards are expected to grow in popularity again in 2009 as a useful budgeting tool.

Andrew Spice added: "Cash-strapped holidaymakers can also use the Travel Money Card as a means of saving money for the summer trip abroad because funds can be loaded on a regular basis in either sterling, euros or US dollars."