The U.S. dollar is off to a sluggish start to the New Year.
Earlier this month, the dollar tumbled to a three-year low against the euro after ending 2017 on a negative note. The dollar index, which compares the U.S. dollar to a basket of global currencies, was down 10 percent last year, making it the biggest annual decline in over a decade. Market watchers have also previously suggested 2018 could be another weak year for the dollar.
"We still think the dollar is probably going to be relatively soggy, at least against the majors, probably against the emerging economies to a significant degree as well," Jan Hatzius, chief economist at Goldman Sachs, told CNBC.
So, what does that mean for you? It might mean that it's time to revise your winter 2018 travel itinerary.
With a weakening U.S. dollar, many traditional, tourist hot spots, aren't exactly financially-friendly anymore. Instead, be sure to book your next vacation at a destination that will get you the most for your money.
This popular vacation destination — home to safaris, vineyards and famous must-dos like Table Mountain and swimming with great white sharks — is a good place for frugal globe-trotters, with one U.S. dollar currently worth 12.26 South African rands. Mid-range, double rooms typically go for about 400 to 1,500 rands, according to Lonely Planet, converting to just $32.59 to $122.20 for U.S. tourists.
The current exchange rate of the U.S dollar and the Mexican peso is favorable for the U.S. tourist, with one U.S. dollar currently being worth 18.80 pesos. In December, the peso fell to a nine-month low against the dollar, however, some are predicting a major comeback for the peso in the early half of 2018. Better book that trip fast. Beach areas like Tulum and Riviera Maya are favorites (and not far from Mayan ruins), or head to the mountains for scenic spots like ex-pat mecca San Miguel Allende.
Travelers who really want to maximize their travel budget this year should check out Chile, where one U.S. dollar is currently worth 606.6 Chilean Pesos. A quick search on Airbnb shows that rooms located in Santiago, Chile are going for as low as $20 a night. Other top sights include the Atacama salt flats, vineyards and the Patagonia region.
While you might have to deal with bigger crowds — as a weaker U.S. dollar attracts international tourists — traveling domestically is a great way to vacation without spending a fortune. Orlando ranked third in KAYAK's 2018 Travel Hacker Guide's "wallet-friendly" category, with the median hotel rate dipping to $115 in January. Along with lots of sun, travelers can enjoy Walt Disney World Resort, Universal Orlando Resort and SeaWorld Orlando. Raleigh, North Carolina placed fourth on KAYAK's wallet-friendly list, followed by Denver, Colorado.
Belgium / France / Germany / Greece / Ireland / Portugal / Spain
Currently, one U.S. dollar is equivalent to 0.82 euros, making countries that carry this currency not the best spot to travel to. The euro is the official currency of 19 of the 28 European Union countries, including popular vacation destinations like Belgium, France, Germany, Greece, Ireland, Portugal and Spain. The U.S. dollar lost roughly 10 percent of its value against the euro in 2017.
One U.S. dollar currently equals 0.73 British pounds, making it hard to feast frugally on all those fish n' chips. In London, a double room in a midrange hotel runs between £100 to £200 pounds, according to Lonely Planet, meaning it will cost U.S. tourists between $137.70 to $275.41 per night.
If China is on your bucket list, consider bumping it a few notches down. Earlier this week, the Chinese yuan hit its strongest level against the U.S. dollar in two years at 6.4372 per dollar. Other Asian currencies are also on the rise; the Wall Street Journal notes that the Korean won, Singapore dollar and Thai baht have also recently been at or near multiyear highs against the U.S. dollar.
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