When it comes to planning overseas travel, how much thought do you put into the value of the Australian dollar?
A recent study has found that the vast majority (91 per cent) of Australians do not know what an exchange rate is or understand how fluctuations in exchange rates impact travellers’ purchasing power whilst abroad.
And it seems a lot of us don’t even care. And that’s despite the consequences a poor exchange rate can have on travel budgets during a period of skyrocketing interest rates and inflation.
According to the study, two in three Aussies won’t look at movements in the Aussie dollar when travelling or spending money overseas.
The study also revealed the priority Australians place on travel, with two-thirds (62 per cent) of Aussies saying they would still travel regardless of the state of the AUD, and two-thirds (63 per cent) still happy to purchase products abroad.
Alon Rajic, founder and managing director of Money Transfer Comparison, who commissioned the study, told Karryon “the push to spend pandemic savings overseas is strong”.
“Australians have come out of the pandemic with increased savings and a desire to spend after more than two years of limited activity,” he said.
“It is positive to see that despite recent economic troubles, most Australians aren’t feeling overly money-conscious and are able to continue purchasing overseas despite inflation and currency falls.”
Overall, Rajic said that four in five Australians are still planning to travel this year, with more than a third (37 per cent) intending to travel overseas.
Dollars and sense
“It is concerning to see that Australians lack fundamental knowledge on the Australian dollar, its movements and its impact on the economy and consumer spending,” Rajic said.
“However, AUD movements will likely be unpredictable, given the current climate and a projected economic downturn.”
Elsewhere, more than half (58 per cent) of those polled thought that American products would be cheaper when the Australian dollar dropped in value against the greenback.
In 2022, the Aussie dollar peaked at $0.76 on the US dollar in early April, before falling to US$0.62 in October. It now sits at around US$0.67.
The independent study took into account the opinions of over 1,000 Australians.
Another recent study found that most people consider travel a non-negotiable expense, with one in five dollars allocated to leisure trips.
