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Sinking pound set to trigger tourism stampede to UK

July 8, 2016 Headline News No Comments Email Email

egtmedia59Exchange rate movement between the pound sterling and the Australian dollar may soon see the dollar worth 60 British pence, which coupled with cheap airfares to Europe could make visiting Britain an almost irresistible bargain.

The value of the Australian dollar was touching 58 pence this morning.

Financiers feel the Australian dollar will soon shrug off jitters caused by uncertainty about the Australian election result. A government should soon be in place, whereas worries about the effect of Britain’s leaving the EU (‘Brexit’) will take far longer to resolve.

Financial analysts see investors seeking Australian Government Bonds, which offer over 2% return, against the negative or barely positive return on most British, German, US and Japanese sovereign debt. If Australia loses its AAA credit rating it might affect matters, but the exchange rate with the British pound should still be firmly in Australia’s favour.

Meanwhile, the World Youth Student and Educational Travel Confederation has published the results of the survey it conducted on the possible impact of the UK’s exit from the European Union on business in the youth travel industry. The study seemed mainly concerned about the effect of Brexit on outbound youth travel from the UK.

“Overall, the outlook from the youth travel community is pessimistic, with 45% saying that they believe business prospects will be worse as a result of Brexit,” a statement said.

“Decreases in business volume between 12% and 19% are expected over the next year.

“These concerns are with good reason. The UK is an important source market of youth and student travellers. Young travellers from the UK aged 25 or younger made 10.4 million trips abroad in 2015 and Europe is one of the most important destinations for them, receiving over 60% of the market.

“While holidays account for more than half of these trips, study, work experience and language learning are also significant travel segments. It should come as no surprise that the WYSE Brexit Survey found that au pair and work experience businesses – some of the sectors dealing with visas – are expecting the biggest decreases in business volume as a result of Brexit.”

“Are there bright spots? Yes. Transport operators expect an upturn and some believe that stricter visa regulations could increase the value of agent services.”

Written by Peter Needham

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