$ buy now or later?

[mdj101]

Hi All,

With the pound strong against the dollar at the moment, do you think it would be wise to buy some now for a holiday next summer. It does look like the pound could weaken over the next few months.

Also, I've heard of a debit / credit card that you can get where you can put the dollars on the card now, earn interest on it and then use it when you are abroad. Has anyone used or heard of this?

[Robert5988]

Question 1 is like asking who will win the 2:30 at Epsom. The best brains in the financial markets, with access to every bit of information available, think the dollar is worth exactly what it is worth today.

Buying dolars now, rather than than leaving your pounds in a high interest UK bank account will mean that you will lose about 3-4% interest between now and next August; the dollar will need to strengthen about 6 to 8 cents for you to break even. If it stays at its current level your will effectively get an exchange rate 6-8 cents lower.

If you want to conserve today's rate you can 'buy forward', but is it worth it for holiday money?

[andy_d]

If it was me and I had some cash put away for a holiday I would buy some dollars now! It is such a good exchange rate now compared to the last few years.

[CERICROWLEY]

Mark

The best thing to do would be to split your money up and buy at different times, this way it would look so bad with the different rates.

[brendawilliams]

A very difficult question Mark. With interest rates set to reduce further, the pound could reduce further against the dollar but if the US also reduce interest rates then it could go the other way. If you are adverse to risk, Ceri's suggestion above seems very sensible as your chances either way would be evened out.

[ShirleyD]

It is of course the impossible question as Robert says. Most reports I have read say it will start to go down a little next year, but would this counteract any interest you would get with the money put away?

[mfairhurst]

It is worth buying at different times as said before and wait and see if you can get good rates ,M & S seem to be good .
MAUREEN
www.onlinefloridavillas.com/villas/1683.aspx

[atush]

I see the pound strengthening in the next week. After that, it's up to the housing mkt and retail sales figs.

All the dealers last week, didn't expect this cut.

A

[Solana]

We try to buy some each month then they are there for our holidays,the rate is so good that even if it goes up a little more you have got an excellent deal. If we try to leave it in the bank it is too tempting to use for something else!