Following the Reserve Bank of Australia’s long-awaited rate cut in February, the Australian dollar’s value abroad has been impacted. For tourists going overseas, this means that their dollar is set to go further in some destinations than in others.
Non-bank lender MONEYME has analysed year-on-year currency shifts across Australia’s ten most popular holiday destinations to uncover the best and worst value destinations for travellers.
Here’s what they found:
Where the Australian dollar stretches further, based on exchange rates
New Zealand
There’s good news for Aussies heading across the ditch, as the Australian dollar is performing well against the New Zealand dollar. The value of the Australian dollar relative to the New Zealand dollar has increased by 0.89%, meaning travellers can expect better value for money when exploring the natural wonders of Aotearoa.
Indonesia
While the Australian dollar relative to Indonesia’s rupiah has seen a slight year-on-year increase of 0.68%, it has seen the highest year-to-date gain of 3.26%. This makes it an appealing choice for cost-conscious Australians visiting the culturally vibrant country.
India & Vietnam
While the value of the Australian dollar has fallen against India’s rupee and the Vietnamese dong year-on-year, the Australian dollar has recovered against both of these currencies since the start of the year, offering slightly better value for travellers compared to previous months.
Destinations where exchange rate fluctuations mean the Australian dollar doesn’t stretch as far anymore:
China
With the Australian dollar declining by 3.20 per cent year-on-year against the Chinese yuan, travelling to China has become more costly for Australians. This means accommodation, dining and experiences in popular cities like Beijing and Shanghai may be more expensive.
Europe
The Australian dollar has weakened against the Euro, meaning ‘EuroSummer’ will likely be more expensive for Aussies in 2025. Year-on-year, the AUD has dropped by 3.65 per cent against the Euro, meaning higher costs in popular destinations like France, Italy and Spain.
United States & United Kingdom
Travellers heading to the U.S. (-3.92 per cent) and U.K. (-6.12 per cent) will find their budget won’t stretch as far as they did a year ago.
Japan & Thailand
The Australian dollar has weakened against the previously cheap Japanese yen, dropping by 4.40 per cent year-on-year and 2.81 per cent year-to-date, the greatest decline against all currencies analysed. Longtime budget-friendly destination Thailand has also become more expensive for Australians, with the Australian dollar dropping by 10.29 per cent year-on-year against the Thai baht.
Travel tips to maximise your budget in 2025
While exchange rates fluctuate, there are ways to make international travel more affordable:
Consider low-cost destinations: Some places offer better value than others, even with fluctuating exchange rates.
Travel off-peak: Flights and accommodations are often cheaper in shoulder seasons.
Finance wisely: Setting a realistic budget and paying in advance can ease financial strain and reduce currency risk.
Compare payment options: A personal loan may be a smarter choice than a credit card for big expenses, as it often has lower interest rates. For day-to-day spending during your trip, a multi-currency card can help minimise transaction fees and ATM charges.
Nigel Bradshaw, group treasurer at moneyme.com.au, explains why a cash rate cut can impact your travel plans.
“Many people don’t factor in currency fluctuations when budgeting for travel, but changes in exchange rates from when you book to your travel dates can significantly impact costs,” said Bradshaw.
“By being flexible with destinations and planning ahead, Aussies can still enjoy incredible travel experiences without breaking the bank. Paying for accommodation and other bigger expenses ahead of the trip will help to reduce the impact of any currency fluctuations before your trip starts. Using your savings or taking out a personal loan over putting everything on your credit card can also be a money-smart option for travellers, as it typically has a lower interest rate and can help you to lock in lower rates and simply make a series of repayments over time to spread out the costs of the holiday.”
Featured image: Random Australia Dollar
