Travel has become increasingly more expensive, with the Canadian dollar at lows not seen since 2020, leaving some destinations heavier on the wallet than others.
The United States has long been a vacation destination for Canadians, but the trade war has dampened people’s interest in travelling south.
According to recent data from the U.S. Customs and Border Patrol, the number of travellers from Canada entering the U.S. dropped by half a million in February 2025 compared to the same time last year.
“We do see a lot of people looking in different directions, not wanting to travel to the U.S. The U.S. has also lost a little bit of a brand value,” Knightsbridge Foreign Exchange President Rahim Madhavji told us. The currency exchange company is based in Toronto.
It might be a financially smarter move for Canadians to find other vacation destinations because the loonie won’t go far in the U.S. As of Friday, US$1 equals C$1.43, according to foreign exchange tool XE.
In addition to paying more down south, Canadians will also have to factor in a new surtax, which is part of the federal government’s retaliatory tariffs, when re-entering Canada.
Madhavji says the tariffs’ impact on the country’s economy, jobs, and interest rates have all contributed to a weaker Canadian dollar.
He adds that last year, the loonie fluctuated in the mid to high $1.30s, which jumped by almost five to 10 per cent since U.S. President Donald Trump came to power and implemented the tariffs.
“Every Canadian has lost about 10 per cent depreciating power of how far their vacation goes, or their home property purchases, or we have Canadians that go to school in the United States,” explained Madhavji. “It has basically become about 10 per cent more expensive as a result of it.”
If you’ve scrapped your U.S. travel plans because of the tariffs, you can visit plenty of other destinations where the Canadian dollar will go a lot further.
Countries where the loonie will go further
Madhavji shared five spots where Canucks can get more bang for their buck.
The first is Argentina, where he says the Canadian dollar has appreciated about 18 per cent over the last year. Currently, C$1 is equal to around 746 Argentine pesos.
“Anyone looking to go to Argentina can get a 15 to 20 per cent better return on their Canadian dollar than they would have if they went a year ago,” explained Madhavji.
You’re in luck if you’ve had Brazil on your bucket list. The foreign exchange expert says the Brazilian reais has depreciated about seven per cent, meaning the Canadian dollar will go much further there. Right now, C$1 is equal to R$3.96.
“You’re getting a seven to eight per cent discount in Brazil,” he said.
For Canadians whose go-to beach destination is in Mexico, the loonie will go far there.
Madhavji says the peso has fallen around 13 per cent over the last year. Just make sure you pay in the local currency rather than the common practice of using U.S. dollars.
Other countries he recommends are Turkey, where Canadians can get an 11 per cent discount; South Korea, where the won is almost on par with the loonie; and Japan, where tourists can essentially get a 10 per cent discount while the loonie is stronger than the yen.
Getting the best Canadian dollar exchange rate
No matter where you travel, trying to get the best exchange rate out there will help stretch your money.
Madhavji says there are two things travellers shouldn’t do when exchanging Canadian dollars. The first: don’t buy cash.
“Cash is very expensive and hard to handle. The places you buy it from have to buy it in advance. They have to physically store it. They have to secure it,” he explained. “That security and handling physical paper costs money; you pay for that at the exchange.”
The second thing jet setters shouldn’t do is exchange currency at the airport.
“That is the equivalent of a tourist trap, that you’re buying it at the last minute. You’re paying airport prices, which is significantly worse than cash rates,” said Madhavji.
He adds that you should only buy at the airport if you get a small amount for tips.
While some Canucks are choosing to forgo visits down south, others may not have much of a choice. Plenty of Canadians still live, work, and study in the U.S. and exchanging Canadian currency for USD is an unavoidable practice for a lot of travellers.
In these cases, the foreign exchange expert advises Canadians to open a U.S. dollar account at their bank, whether a savings or no-fee account.
He then says to go to a non-bank and non-airport currency exchange that buys money in bulk and negotiates a better rate with the bank so that its customers can get a better rate. From there, you can exchange your Canadian dollars electronically so that the U.S. dollars go directly into your U.S. account.
“Now, you can go to [your bank] and withdraw U.S. dollars, and you only pay the regular kind of banking fee,” explained Madhavji. “You’re not doing your exchanges through your bank; you’re just withdrawing the U.S. dollars.”
