After 23 years since its introduction, the Euro is at parity with the dollar. It may seem, at first, like this is good news for Americans visiting the Old Continent, but here’s one thing other travel news sources are blatantly ignoring: despite the lower conversion rate, you won’t be saving much on your next trip, and on this post we will explain why.
On July 11, one dollar became equivalent to one euro for the first time in History, a status that was maintained for the rest of that week up until July 15, when the Euro came out ahead only slightly. Now, at the time this article is being written, 1 euro still buys only $1.01, proving Europe’s once super strong currency is under pressure in the wake of the ongoing crisis.
Even then, American travelers shouldn’t be dreaming of a much more affordable European vacation just yet:
Traveling Europe Is A Lot More Expensive Now Than It Once Was
There is a reason why the Euro has lost part of its value in recent months: the 2022 economic upheaval is hitting the Eurozone hard, and after two years of Covid, coupled with the conflict in Ukraine, the continent’s economic stability is under serious threat. In practical terms, inflation in the European Union is high – dangerously high.
According to the European Commission, Europe should expect turbulent times ahead, with inflation projected to hit 7.6% this year alone – a higher number than the already concerning 6.1% that had been forecast earlier. In 2023 there will be some improvement (4%) but it is still no consolation when Europe’s current woes may not be solved anytime soon.
As one of the world’s leading oil exporters, Russia has shown no signs it will reverse course and cease aggression against its neighbor, which means prices for a number of commodities – including petrol – will likely increase. Although it has not taken up arms against the European Union, Russia is also cutting their gas supply, again destabilizing the group.
If you don’t think what happens to Europe – or Europeans – affect you directly as a tourist, we’re sorry to inform there is a rather pessimistic economic projection for the future. According to the European Commission, prices in the Eurozone will climb 7.6% this year, while the EU as a whole (including countries that do not use the Euro) will face an 8.3% rise.
What Does This Mean For Travel In The Short-Term?
In reality, Europe travel is getting more expensive than it once was, irrespective of the euro drop. You may be able to buy 991 euros with $1000, or 14.3% more than you could a year ago, but ‘pure’ conversions do not take into account the record-high inflation, or the drastic readjustment in prices. Basic expenses are getting costlier, from energy to food and everything in between.
The Commission has recognized some of its worst fears have ‘materialized’, and that the purchasing power of EU citizens is eroding quickly. 100 euros might had been enough for two weeks’ worth of groceries a few years ago in some EU countries. Now, that is barely enough for a week of supplies, as basic items like milk, vegetables and meat all see price hikes.
Tourists are not immune to it either. Besides the high cost of living, hotel fares have surged to record highs in response to inflation, and low cost travel is silently disappearing. There are three or four countries where your hard-earned dollars may be worth more, but in general, Europe is far from being the next budget-friendly haven for Americans.
What EU Countries Are Hit The Hardest?
There are nine EU member states in total predicted to end 2022 with double-digit inflation records. They are:
- The Czech Republic
Prior to 2022, all of these countries had been among the trendiest to visit in Europe. Many of them are not in the Eurozone, including Bulgaria, the Czech Republic, Hungary, Poland and Romania, and they attracted solo travelers not only due to their incredible cultural offer and picturesque cities, but their high affordability.
Things are not nearly as bad as in Ireland or Denmark, two of the most expensive countries one can visit in the EU, but Eastern Europe is no longer the ultra cheap destination it used to be. Inflation is rising, and compared to France, a Western European country with ‘only’ 5.9%, Estonia and Lithuania are facing a staggering 17% inflation rate in 2022.
More and more, the East-West ‘low cost travel divide’ is getting blurrier. Western Europe is usually associated with high end travelers, being home to some of the poshest destinations in the continent, including Madrid, Paris and Milan. Eastern Europe, on the other hand, is – or used to – be popular among backpackers and youngsters looking to travel more for far less.
A one-week vacation in Transylvania, Romania’s inland mystical province where countless medieval castles and citadels can be found, will not exactly break the bank compared to a single, long weekend of partying in Ibiza, but as the crisis hits Europe’s Eastern flank the hardest, purchasing power is bound to be much more limited – even in the likes of Romania.
How To Actually Save Money Traveling In Europe Right Now
Here are some tips for truly saving more money on your European vacation now that the euro has taken a plunge – regardless of readjustments:
- Opt for countries that have comparatively lower prices for goods and services – this will help your dollars go further
- Keep an eye out for good vacation deals – you may be able to book luxury stays for as little as $150
- Do not leave flight or train bookings until the last minute – you could be paying intercontinental fares for a simple intra-EU journey
- Do not check bags this summer – this will help you travel stress-free and get the cheapest fare possible
- When changing money at your destination, always research the best currency exchange – preferably, use authorized offices*
- Get insured for disruption – you will avoid having to fend for yourself and paying for emergency expenses if your flight is delayed or canceled
- Some European countries like Spain are offering either free, or discount train tickets this summer – make sure you check them out
*Scams are incredibly common across Europe and now that every penny counts when it comes to travel, you don’t want to be the next victim
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This article originally appeared on TravelOffPath.com