Saturday, October 8, 2016

Time For a UK Holiday Soon?

I know it might sound ridiculous to some people, but I have planned my holidays based on currency exchange rates before.

I went to Japan when the SGD/JPY was at 85, and now it is a 75. It doesn't seem like much, but that's actually translates to me to about a 12% discount for my whole holiday on everything that I spend! It was a good holiday, but if things continue the way that they are going right now, a weak Yen for happy holiday makers will be back in the back within a few years time.

Even before the Brexit trigger (click here for my lengthy piece on it), the pound has been slipping. I remember back in 2014 and 2015 I was mulling over the decision to go into broad based foreign ETFs as a a lazy way to get international exposure and to be diversified. One of the things that put me off was actually the GBP/SGD exchange rate. I had gone to research about the benefits of investing in GBP, but I discovered something else instead. Did you know that the GBP/SGD rate used to be 8.6? And now we're at 1.7.

Maybe I'm biased, but if you ask me, I think that we still continue to strengthen against most of the currencies around the world. I'm almost certain that we will reach parity with the USD sometime in the next decade. Doing the same for the GBP wouldn't be too far away from that too.

Anyway, with the GBP at very attractive rates compared to the SGD, it does seem a lot more attractive to head over to the UK and have a nice holiday. I did enjoy my visits to the UK, so I'd be happy to go back again and see more! If you've been itching to go to London, now might be one of the best opportunities for you to go!

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