The cost of that summer holiday abroad has just come down thanks to a dramatic surge in the pound against other key currencies.
Bolstered by a string of positive economic developments, sterling hit its strongest level against the the dollar since January ($1.51), while also making strong gains on the euro (€1.13).
Following all the panic surrounding swine flu, the gains will serve as much-needed good news for travellers, reducing the overall cost of their holidays by as much as 10%.
Pound may take a hit tomorrow
However, one foreign exchange provider is warning that some of these gains may be undone at tomorrow's Bank Of England's (BOE) meeting.
Although it is widely expected that the BOE will keep interest rates on hold, major analysts and investors fear that the BOE may announce that it will be adding to the current level of £75 Billion that has already been pumped into the economy, says Foreign Currency Direct.
“Should this be announced, sterling may well once again this year lose ground that it has recently gained - something that appears to becoming an unwanted pattern throughout 2009- especially for those with upcoming large transactions for new homes and investments,” it adds.
Good news for those staying at home
For those looking to stay at home this summer, there was also some good news.
Research from the British Retail Consortium (BRC) shows that food price inflation has eased for the first time this year.
Annual food inflation dropped from 9% in March to 7.9% in April, indicating that the worst may be over for consumers, says BRC director general Stephen Robertson.
“With food cheaper than a month ago, the worst of food price inflation may be over, thanks to a more stable value for the pound but rising farmgate prices for meat and some vegetables are the main factors working against retailers’ attempts to keep overall shopping bills down.”
