Holiday euro in summer 2012:
Holiday euro not impacted by the crisis in summer 2012, decline in value over 2011 limited to Asia
- Weaker euro results in lower purchasing power in Asia
- In Europe, little change over previous year
- Hungary, Turkey and Croatia lead the field of top holiday destinations
- The holiday euro is worth more somewhat more in many euro area countries than in Austria
Despite the euro crisis, the value of the holiday euro is for Austrians this year the same as a year ago. Only people travelling to Asia will feel the impact of the weaker euro. "The holiday euro is not experiencing a crisis; only tourists in Asia will be affected by the current problems of the euro," says Stefan Bruckbauer, chief economist at Bank Austria, commenting on the recent calculation of the holiday euro. While the euro has weakened somewhat against many currencies in a year-on-year comparison, this is hardly noticeable in most of the key destinations for Austrian holidaymakers, especially because the euro is worth more in Turkey and Hungary, two important holiday destinations.
Compared with 2011, only tourists heading for overseas destinations in Asia will be aware of the weaker euro. "This year the value of the holiday euro in overseas countries is down by an average of about 10 per cent on a year ago, and in Asia the average decline is as much as 14 per cent," says Stefan Bruckbauer, adding that "the value of the holiday euro has depreciated by an average 12 per cent in Asia; the decline is further accentuated by the somewhat higher inflation rate in Asia". America provides a more differentiated picture: this year the value of the holiday euro in the US is about 5 per cent down on the previous year, while remaining more or less unchanged in South and Central America but varying significantly from country to country. In Mexico, for example, the value of the holiday euro fell following the appreciation of Mexico's currency, and in Brazil it was up in response to the depreciation of the Brazilian real.
Among the top holiday destinations for Austrians, the holiday euro remained constant compared with 2011, with a value that is 21 per cent higher than in Austria itself. This is not surprising as many of these countries either also have the euro, or their currency is linked to the euro. Tangible benefits for Austrian holidaymakers are limited to Turkey and Hungary as a result of a depreciation of these countries' currencies, even if some of these benefits are offset by higher price increases. The holiday euro lost 1 per cent in Italy due to a slightly higher inflation rate, and gained 1 per cent in Greece. Italy is moreover the only of the Austrians' top 10 holiday destinations where the value of the holiday euro is lower than in Austria, even if the difference is only 2 per cent. Compared with Austria, the holiday euro is worth only a little more in Germany and France. Among the favourite holiday destinations which have the euro, the value of the holiday euro is significantly higher for Austrians in Slovenia and Portugal, and slightly higher in Greece and Spain. Apart from price levels in London – especially as a result of the Olympic Games – the holiday euro in the UK would this year in average terms more or less match its level in Austria, down by 3 per cent on the previous year.
Holidays in Switzerland remain an expensive experience: 100 holiday euros are worth only 64 euros – the lower inflation rate cannot offset the strong currency. In Ireland, too, the value of the holiday euro is worth appreciably less than in Austria, only about 90 per cent. This also applies to Canada, Sweden and especially Japan.
In less frequently visited holiday destinations in Europe, the holiday euro is still considerably stronger in Romania, Bulgaria and Poland than in Austria. The value of the holiday euro is also higher in the Czech Republic and in Slovakia than in Austria. Among the countries monitored for this purpose, the strongest year-on-year increase in the value of the holiday euro was seen in Poland, and the most pronounced decrease was in Egypt.
In conclusion, the economists of Bank Austria would like to point out that these figures are average values that could differ for individual regions (such as the central region of London, for example). The price levels refer to the average price of goods and services in the various countries; prices for individual products could differ substantially (especially for tourists). Therefore, the changes in value rather than the values themselves are listed for holiday destinations, including far-off destinations. Furthermore, the fact that the price levels are so much more affordable in some holiday destinations than in Austria is primarily due to the high income levels in Austria. If the price level were lower in Austria, the income level would also be lower – many of us would most likely not be able to afford a holiday.
charts (PDF; 55 KB)
Rückfragen: Bank Austria Economics and Market Analysis Austria
Stefan Bruckbauer, Tel. 05 05 05 - 41951
Bank Austria Pressestelle Österreich
Matthias Raftl, Tel. +43 (0) 50505 - 52809
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