The Reason a Trip to the U.K. Is Such a Good Deal Right Now

It’s a great time to practice your British accent.
It's a great time to travel to London

If formal gardens, a little rain, fish and chips and the other kind of football appeal to you, then a trip to the U.K. might be the change of scenery you need. And thanks to larger forces—namely, Brexit—now's a great time to start planning your vacation.

Ever since the Brexit referendum in June 2016, Britain's economy has been in flux, and it hasn’t improved much in the intervening two years. All this uncertainty has knocked the UK's economy down a few pegs. While this is bad news for characteristically stiff upper-lipped Brits, it means that, for the time being at least, Americans can visit Britain for less.

Last April, one U.S. Dollar would buy you about 70 pence. Today, that same transaction goes for about 79p. While 9p extra might not sound like a lot, look at it this way: if you're shopping with U.S. Dollars, everything in the U.K. is 13% cheaper than it was 8 months ago. And it's possible that discount will grow even larger as until Brexit goes into effect on March 29, 2019.

The dollar to pound: a look back

The GBP/USD exchange rate has been on a steady downward decline since the height of the Civil War in 1864, when one pound would net you nearly $10 dollars. In more recent history, the cheapest the pound has ever reached was on March 1, 1985, when £1 would buy you $1.07, according to exchange history from the Bank of England's Foreign Exchange Desk. Since then, the pound has bounced back a bit, but not enough to cross the UK off your vacation itinerary.

The Dollar's value against the Pound

USD/GBP exchange rates since 2007

This change in the dollar-to-pound conversion rates won't do much to lower your airfare since so many other variables go into determining those rates. So if you're looking for a cheap flight to visit the queen—or better yet, to arrive in time to celebrate the Royal Birth of Harry and Meghan’s first child—you're better off checking the secondary marketplace for unused tickets or booking your flight with airline miles (and you should probably wait until after New Year's to do it). But everything from hotels to restaurants to those traditional black cabs have standardized rates, so you should be able to buy more with less for the time being.

It's impossible to predict whether this shift in conversion rates will continue to grow or vanish—sort of like a Harry Potter Transfiguration spell; the U.S. economy is in a precarious situation at the moment and there’s always the chance that the U.K. economy could bounce back if Brexit negotiations change course. So if you're set on traveling to the U.K. at some point in the near future, now's a great time to start thinking about it. But if you'd like to test fate and wait, it's possible this discount could get even larger in the months to come.

Daniel Caughill

Daniel is a Staff Writer at ValuePenguin, covering insurance, retirement and other personal finance topics. He previously wrote about compliance and best practices for K-12 school districts at Frontline Education.

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