Michael ONeill:independent.ie/…/plunging-euro-value-hits-irish-… Plunging euro value hits Irish tourists in the pocket Sharp falls in the value of the euro mean Irish holidaymakers will pay more if they travel to the US, the UK or Australia. The currencys downward plunge means tourists from this country need more bang to get a buck. A month ago, one US dollar cost 81 cents, but now it costs 86 cents. A US hotel costing $200 a night will set Irish people back €174 a night, compared to €163 a night a month ago. In London, a £50 meal will cost Irish tourists 9pc more than this time last year. The euros fall against other currencies, including the Swiss franc which soared higher yesterday after that countrys Central Bank lifted a cap on its value, has been even more extreme. Economists expect the fall - and the bad news for Irish tourists - to continue, with the European Central Bank (ECB) widely expected to start printing money to try to kickstart the flagging Eurozone economy. The ECBs Governing Council meets on Thursday and could announce plans for the stimulus package afterward. I think theres definitely further downward pressure for the currency, Goodbody Stockbrokers chief economist Dermot OLeary told the Irish Independent. Its very simple economics, if you increase the supply of something, that generally reduces the price of it. Mr OLeary said the impact on the euro would be determined by the amount of money the ECB decides to inject, and that he could see the euro eventually falling to as little as $1.10 in US dollars. Travel agents downplayed the falling currencys effects on their business yesterday, saying the euros drop was being outweighed by growing momentum in the economy. [The euro] has had a lot of activity in the last two or three weeks, its dropped right down. However, were up 40pc vis-a-vis last year. The bookings all this week are very strong, Tour America managing director Mary McKenna said. Most Irish people pick the States because of shopping. I still think you cannot beat what you get in dollars when you go shopping. Even if they changed that dollar sign to euros theyre still very good value compared to what were paying. Cassidy Travel director John Spollen said air fares to the US were very competitive. The euros fall is good news for Irish exporters. Their goods will now be cheaper in the US and the UK - two of our major trading partners. Soaring Swiss franc makes Davos luxury dearer A lot of extraordinarily wealthy individuals - even more than usual - will be knocking around Switzerland next week for the World Economic Forum in Davos. Microsoft founder Bill Gates, Facebook chief operating officer Sheryl Sandberg, and billionaire Russian oligarch Alisher Uzmanov are among those attending, but even they might notice that things have gotten a little pricier this year. The Swiss franc soared on Thursday after Switzerlands Central Bank lifted a cap on its value, meaning that caviar, champagne and cigars will cost foreigners with expensive tastes even more money. Im glad I didnt plan to stay a few more days to ski this year, one attendee told Bloomberg. Things were expensive enough as it was. Zurich, Geneva and Bern are among the worlds 10 most expensive cities, according to a study by US consulting firm Mercer. Dublin came 51st. The currency movement is bad news for Swiss exporters too. Shares in Richemont, the company that owns luxury watch makers IWC and Vacheron Constantin, took an absolute pounding on Thursday, and the manufacturers may be forced to raise prices in order to cope with the effects of the currency move.
Posted on: Sat, 17 Jan 2015 10:11:01 +0000
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