Strong pound boosts expat spending power in South Africa, Turkey and Thailand

Published:  17 Apr at 6 PM
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As the pound strengthens along with the recovery in the UK, a newly-introduced online currency index will help travellers and expats to select the countries with the most favourable rates.

Fluctuating currency rates are an endless worry for most expats on UK pensions or with investments paying interest in sterling. Over the last year, the winners have been those living in South Africa, Turkey and Thailand, with the strong pound and weakness of local currencies granting them between 20 and 30 per cent more spending power.

In general, sterling has strengthened against most world currencies over the last few months, due mostly to Britain’s recovering economy and low inflation. For expats in New Zealand, however, it’s bad news as sterling is now 7.8 per cent down against the NZ$.

The above figures are findings from the UK Post Office’s newly-launched currency index service, aimed at its foreign exchange customers. The index tracks exchange rates quarterly, highlighting the best-sellers, with one in four Brits heading abroad using the Post Office for foreign currency purchases.

According to the index, 66 per cent of top currencies have now fallen against sterling by over 10 per cent, with a fifth dropping by more than 20 per cent. Against the US dollar, the pound has gained 10 per cent although it’s still in the doldrums against the euro.

Expats living in Turkey and receiving their pensions or investment interest in sterling are well ahead with a 30 per cent increase, and just under 30 per cent more rands can be purchased for one pound. Retirees in Thailand have seen a 20 per cent increase over the last six months, and expats in Indonesia and Russia have gained by similar amounts.

The underlying reason, even taking into account weaker overseas currencies, is that sterling is significantly stronger and is maintaining its traditional stability. Although the Post Office doesn’t’ offer the best exchange rates, its new index could prove useful for checking currency movements.
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