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The fall of the pound: a tale of two cities.

The fall of the pound: a tale of two cities.

The fall of the pound: a tale of two cities.

 

 

 

Rob and Chloe share a small Starbucks while admiring the bright lights of New York’s Times Square. Cost of coffee? Almost $ 5. They have also had a cake and a sandwich. $ 16 or more.

According to the exchange rate they got in Kent, Nurse Chloe estimates that the total cost was around £ 17. “Given where we are, I guess it was not too excessive,” she says. “But I think it’s the most expensive coffee I’ve bought.”

Lunch, in the heart of Little Italy, was also a revelation. Two margherita pizzas, two glasses of wine and tip (mandatory everywhere): $ 96.

‘Seeing the cents’
Chloe said, “We’re looking at the cents, it’s not ruining our trip … but there are things we thought we would do that we will not do now.”

They had come to Times Square to buy discounted tickets for the Broadway shows. Even these were too expensive. “We’ll avoid it this time,” says Rob, who, like Chloe, did not want his last name used. Like tens of thousands of tourists from the United Kingdom, the couple chose an expensive time to visit the United States.

This week, the pound sterling reached a minimum of more than two years against the dollar, trading at less than $ 1.25, a rate not seen since April 2017. But these are trade rates. Tourists get worse treatment when changing currency.

And yet, the recent weakness of the pound sterling has not affected the number of visitors.

According to the US Department of Commerce. US, 1.8 million Britons visited the USA UU In the five months prior to May 31, 8.2% more than in the period of 2018. The vast majority were tourists and people who visited friends and family.

By 2018 in total, 4.7 million visited, 4% more than in 2017. However, this is below the peak year of 2015, when 4.9 million people visited.

But analysts doubt that the numbers remain for the rest of 2019. In fact, Adam Sacks, president of Tourism Economics, based in Philadelphia, believes that official data overestimate the outlook.

‘Defying gravity’
To begin with, the growth of airline passengers from the United Kingdom to the US. UU It increased by only 4%, he said. “At this moment, the [United Kingdom] market is defying gravity.”

Help the United States be an attraction on the wish list. “That will always sustain tourism,” he said.

But with the pound sterling facing more headwinds due to Brexit, the economic slowdown and trade wars, “I expect total incoming traffic for the year to end up about 2.5% more than in 2018,” he said.

It is not the first time that the Strattons of Hatfield, Hertfordshire, visit New York, but it is probably the most expensive.

They booked their hotel and flight last year, so they think they got a better offer than now. “And we are aware of all the free and discounted attractions that are available,” says Annette. She advises visitors to do their research and look for them to save money.

But Richard says: “Going out to eat for all four of us is very expensive, at least $ 100 per hour.” Taxes and tips on sales mean that costs will soon rise, even hotel charges for the use of Wi-Fi. .

They have divided some breakfasts and drinks between them to help reduce costs. And they expected to see one of the successful Broadway shows: hopefully Hamilton. “But not at $ 1,200 for the family,” Richard said.

Annette says that when you are on vacation there is a certain “pay what is needed” attitude. And the daughters Georgia and Kerensa say they love their trip, which, as parents know, is what matters most.

The girls especially look forward to next week, when they visit Florida’s amusement parks. However, mom thinks it could be even more expensive than New York.

Chris Heywood, an executive at the New York tourism office, NYC & Company, says it would take a prolonged and prolonged depression to get the number of UK visitors to his city.

The British make up the largest group of foreign visitors, with 1.26 million people visiting the sites in 2018. The number has grown steadily since 2012, when a million visited it.

“People are planning their visits better, more coming in the first three months of the year, when hotel rates go down,” he said. His greatest advice: “Visit our website, there are so many free things to do”.

‘It’s not a surprise’
In London, however, Americans are getting a little more for their money.

Joy Smith, from Colorado, was in London to meet her daughter Reilly, who was on the last stop of a six-week European tour with her husband Seth before the couple returned to Texas.

Joy said she expected the prices to be higher but, in fact, the cost of the food was “very comparable” to the prices at home.

But the Baycroft family had a different culinary experience in London. Johanna had just bought her son, Cougar, a meal at McDonald’s, which she said would have cost almost half the price at home in Washington state.

However, the prices in general were lower than she had budgeted, although she had prepared for the worst and had saved money by staying with her sister.

Bob and Priya were leaving Hamley with their two daughters, who had bought two teddy bears. The couple was used to New York prices, so London “was not a surprise,” said Bob.

The EU referendum in June 2016 brought down the value of the pound, making things cheaper for American tourists. Before the vote, $ 1 was worth around 68 pence. Now it’s worth around 80p.

And that caused a big increase in the number of people crossing the Atlantic. The Office of National Statistics recorded a 13% increase in the number of Americans arriving in London in 2017, with 2.6 million visitors spending around £ 2.2 billion, when a dollar was worth an average of 81 pence.

 

That helped offset a slowdown in domestic spending, according to Henry Gregg of the New West End Company, which represents the companies in central London.

“For domestic buyers, it’s bad because they see prices rise,” he said. But it’s good for international buyers who can take advantage of the “big price differential” in the short term, he said.

Luxury brands have been the main beneficiaries of the increase in spending by American tourists, Gregg said. Budget retailers like Primark have also benefited. It has been “in the middle of the road” clothing stores like Topshop that have been lost, he said.

While the number of Americans visiting London increased slightly in 2018, they cut spending, paying £ 2 billion, down 8% from the previous year.

 

Mr. Gregg believes that the restriction of portfolio funds is normalized as retailers raise prices to reflect an increase in costs as a result of an unfavorable exchange rate for importers.

But that does not deter Americans from taking their tourist dollars to London, according to the New West End Company, which also monitors room reservations, an early indicator of visitor numbers.

He said that the number of projected visitors would increase 4.8% for June to August.

London, like New York, is on the must-see list of most tourists. Exchange rates may fluctuate, but the appeal of bright lights remains.

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