High loonie cuts costs in most popular holiday spots

Thinking about a holiday destination? The soaring loonie may be opening up a world of possibilities, making travellers' budgets to some of Canada's most popular holiday spots, in particular the U.K. and Europe, stretch further.

Overall travel demand is likely to increase slightly this year as the economy recovers, according to the Association of Canadian Travel Agents. While the dollar isn’t likely to give a significant boost to the number of people traveling overseas, it may influence the choice of destination.

“The Canadian dollar is among the strongest, so Canadians have the upper hand around the whole world,” ACTA director of marketing and communications Gary Ralph said.

“It will make a big difference for spending on the ground overseas.”

Travellers to the U.K. and countries that share the euro are likely to note among the biggest differences in costs, as the value of the euro and pound have plummeted as countries continue to struggle out of recession.

The Canadian dollar is now about 50% higher than it was two years ago against the British pound, buying 66 pence today, compared with just 44 pence on March 19, 2007, according to Bank of Canada figures.

The cost of an average pint of beer in a British pub will now set a Canadian traveler back about $3.20 compared with $4.80 two years ago.

The loonie has risen 14% against the euro in the same period and 16% against the U.S. dollar. Turkey, seen as a potential holiday hot spot this year, has seen its currency depreciate about 26% against the loonie.

The number of Canadians travelling abroad dropped by 1.5% last year, with travel to the U.S., the most popular destination falling by 0.9%.

Outside of the U.S. the most popular spots for Canadian tourists last year were the U.K., France, Germany, Japan and Australia, according to Statistics Canada figures.