Tag Archives: currency exchange rate

4 Benefits of Traveling to the Philippines

The Philippines is a very interesting country with over 7000 islands, that is still relatively undiscovered, even among the backpackers and travel bloggers.

Low-cost travel to the Philipines is very possible as the USD to Philippine Pesos (PHP) currency exchange rate is very favorable for US dollar now. For every USD $10 you get several hundred PHP. It is not the cheapest country to visit for travelers from the US but it is still a low-cost country to visit. You get a lot for your money compared to the states.

For the next year, the Philippines Tourism authority is actually doing a project called “It’s more fun in the Philippines”. Expect to see a spate of travel bloggers covering all those as yet undiscovered places on your nearest blogs soon.

1. Experience Philippines on a low budget

As the exchange rate favors those with US Dollars, you can afford a lot of adventures in the Philippines. As a country with thousands of islands, you can choose cast away on a deserted island, you just need to rent a boat to get you there. When in Manila, you can take a ride in one of the many colorful jeepneys. Eating locally is very cheap. Opt for a national favorite, chicken adobo or a seafood bbq.

2. Get Certified for Scuba Diving for cheap

The Philippines has thousands of islands and thousands of miles of coastline. The most famous destination for scuba divers is Boracay. It’s an island with unspoiled white sandy beaches but the treasures lie below the waves. It has the highest density of coral species in the world. It has been a favorite for Asian visitors for years but the rest of the world has yet to discover it.

Imagine swimming, snorkeling, and scuba diving in the warm tropical waters and taking a dive boat out to one of the many dives sites. If you have not been diving before, you can get a license at diving training centers found in diving spots on several of the more popular islands. If you are an experienced diver, some of other dive sites that you should check out are the UNESCO World Heritage Site Tubbataha Reef.

Getting your scuba diving license here is a great idea as you are paying for the lessons in Philippine pesos and is almost always more affordable than getting certified in the states. Besides, you get to do your test in the beautiful clear blue waters of the Philippines.

3. A good base for a digital nomad

The average monthly rent for an apartment in Manila is about $300 a month. For this, you will get a nice place that is popular with the expatriates. As the cost of living in this South East Asian country is quite low, your monthly outgoings will not be too much. That’s especially true if you are getting paid in US dollars.

4. Retiring in the Philippines

If you are looking for a new place to retire that is cheap to live, great climate, affordable healthcare, where you can have a high-quality lifestyle for not a lot of money. As an expatriate, you are allowed to work and have unlimited entries into the country. If you are over 60, the Philippines government gives you special discounts on living and health-care costs. You will also be exempt from airport taxes, great if you intend to travel around the region a lot.

If you get your pension of income in US dollars, the equivalent in PHP will allow you to afford a very decent lifestyle. The Philippines is definitely one country you can consider.

What Causes the Currency Exchange Rate to Fluctuate?

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If you are traveling to any international destination, you have no choice but to know and understand the constant fluctuation in the currency exchange rate. You should not be surprised that exchange rates for all currencies change every day. If you would be more strategic, you can take advantage of such movements and buy currency at the best possible price.

To begin with, exchange rates normally and frequently change due to interrelated factors combined with the reaction of the market (consumers and businesses). This way, it is very difficult, if not impossible, to predict when or how much such rates would rise or fall. Here are common factors that cause this flux.

Law of supply and demand

In simple terms, when there is an oversupply of currency in a market, the value decreases. On the other hand, when there is a robust demand, the value increases. This way, a country’s central bank can influence the currency exchange rate by lowering supply of currency to increase its value or by increasing supply in circulation to lower it. This dynamics is called a government’s monetary policy.

Inflation rate

The rate at how prices of goods and services in a market moves is called inflation. If a country has a high inflation rate, there usually is a depreciation in its currency. As a traveler, this could work both ways for you—your dollar could be worth higher when converted to a country’s currency, whereas you could also experience the downside because you might find costs in that area very expensive when you travel.

Government debt

Are you familiar with credit ratings? Here’s the analogy: if your credit rating is good, you could easily make loans from lenders with very attractive interest rates; the same goes for countries—if an economy has a good credit rating, it can borrow from international funds easily. A country with bad rating may suffer from currency depreciation.

Political and economic stability

Travelers often monitor the political stability and security of their next travel destination. In terms of currency exchange rate, this kind of monitoring is also important. Countries with stable political climate have stronger currencies, while those with political turmoil undergo depreciation.

Conclusion

In all these factors, one thing is certain: you could not accurately predict how much the exchange rate is if you are buying currency for a scheduled trip to any country. This is how Xchange of America (www.xchangeofamerica) could be of service to you.

Before deciding on how much to buy, you could use its online currency converter to determine how much your designated amount of dollars would equate in the currency of your next international destination. From there, you could decide how much you could comfortably buy. Take note that rates may vary each day due to the market dynamics discussed here.

Whether the currency rate is favorable or less favorable for you, it will always be advisable to buy ahead of your trip so you could spare yourself from the stress and risks that may also be brought by currency fluctuations from any of such factors.

The Best Financial Conditions for Travel

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Believe it or not, there is a best and a worst time to travel. No, not due to the weather, the season, or when someone has accrued enough personal time at work to take a break, but rather, a best time financially to travel and explore the world.

The conditions that make for the best time to travel from a financial stand point can get very in depth, so here we will try to break it down into simple components.

If someone is taking a trip out of the country, say for instance from the United States to Greece, they would want to get the most bang for their buck. In order to do this, they want the United States dollar to be as highly valued as possible when compared to Greece’s currency (the Euro). Simple concept, right?

Well, it gets a bit more complex than that. Many factors can change the relationship between the value of the US Dollar and the Euro. For example, if the United States government decides more dollars need to be printed and circulated through the economy, the value of the dollar will decrease because there are more dollars.

The opposite occurs when the US wants less dollars to be in circulation, therein taking dollars out of the economy and increasing the value of the dollar because there are less of them. Like diamonds, the rarer the dollar, the more valuable it is in comparison to other currencies. Travelers going from the United States to a foreign country want the dollar to be as powerful and as valuable as it can be so that they can use their dollars to buy more of their destination country’s currency, effectively giving them “more bang for their buck”.

Other things that could cause a change in the amount of foreign currency one can purchase is the conditions of the destination country. In our example, the traveler is going from the United States to Greece. The Greek government has a very high volume of debt obligations, leading to extremely poor economic conditions right now in Greece.

This means that the American traveler has a prime opportunity – all else equal – to get great “bang for their buck” using USD to buy euros in Greece because the average cost of goods in Greece will be less due to poor economic conditions. Hotels, food, and transportation will all cost less than it would on average if someone was to visit Greece before these poor economic conditions began taking shape.

While there are several other factors that contribute and work together to determine how much foreign currency can be bought with the traveler’s home currency, it is important to understand how the world can influence the prices when going to buy currency. This is why it is important to keep track of currency exchange rates, and pay close attention to the conditions of the destination country. This will lead to the best financial decision when it comes to timing a trip to international destinations in the future.

Understanding Currency Exchange Rates

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The language of currency exchange can be confusing, whether you’re at the bank or trying to navigate online currency exchange rates. Using sites such as Xchange for America takes away much of the guesswork, but what if you come across some strange language as you try to understand your currency exchange to the fullest? Luckily, the language is easily explained, with a basic overview of each term.

Read on to understand what’s happening with your money at every exchange. If you have any specific questions about currency exchange rates, you can always call Xchange of America at (888)-7-XOA-XOA 7 days a week.

Sell Rate

This term is used to discuss the rate which foreign currency is sold for local currency. When you are preparing to change your American money for the target company’s currency, you will use your target country’s sell rate to determine how much your exchange is worth. You’ll also hear this term as “holiday money rate” or “tourist rate”. All three phrases mean the same thing.

Buy rate

This term is used at the end of the trip. It is the rate at which the foreign currency, from the target country, is bought back from the travelers who have returned home. This moves the target country’s money back to the local money, and is subject to the most updated rates.

Spot Rate

This term is a little more confusing. It is the interbank rate, and is the rate that most larger financial institutions will charge each other, if they are trading higher amounts of foreign currency. It is not a tourist rate, nor can a traveler buy currency under these rate parameters, because the amount of currency being purchased are not large enough. Compare the spot rate to the buy or sell rate by using retail terms: the difference is similar to wholesale and retail prices. The rates that you might see in financial newspapers or in other media typically reflect these spot rates.

Spread

This term refers to the difference between sell and buy rates, usually offered by foreign-exchange providers. It’s important to pay attention to this, so you get the most for your money, both before you exchange, and after you return home from your trip.

Cross Rate

The cross rate is the rate given to customers who wish to change currency that doesn’t involve local currency. The best way to understand this is through example: do you want to change Australian dollars to American dollars? You’ll have to ask about the cross rate for this transaction.

Commission

The commission is the common fee applied to currency exchange, so the exchangers are able to make some money. Fees for exchanges are unavoidable; this is why it is essential to find the best possible rates, with the fewest amount of fees, so you get the best exchange possible.

Get more information about currency exchange rates by calling any of our experts at (888)-7-XOA-XOA. You’ll be able to ask about rates for any of the currencies that we offer on our website and find out whether or not it’s a good time to make a currency purchase.

Basic Financial Travel Tips

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Achieving money saving tips for traveling will lead to a greater amount of travel, heightened chances for adventure, and more opportunity to interact with the world. Organization and prioritizing are the most important aspects of planning financially for a trip, especially if you want to travel to more than one destination, or more than once in your lifetime. Everything, from travel goals to currency exchange rate, must be considered for successful traveling. Follow these tips when planning for your next trip to ensure you have the best possible time with the least amount of financial stress.

Make Travel Goals

The first priority must be to create specific travel goals. You need to know where you want to stay, and for how long. You should also find out what you want to do there: do you want to sightsee? Scuba dive? Mountain climb? You’ll need to know how much every part of the trip costs before you can consider building a stable financial travel plan. Read as much as possible about opportunities and amenities in the target country to avoid financial surprises.

Save Now

Traveling gets expensive fast. Once you know where you want to go, decide how long it will take you to save the necessary money for travel. You’ll want to make sure to save an extra 15% to cover emergencies, incidentals, and any unknowns that occur while traveling or at home. Plan to leave some of the cash in the bank account at home, using the rest on a site such as Xchange for America, where you exchange home money for the foreign currency.

Make a Budget

It’s been said before, but it’s worth stating again: create that travel budget. You’ve done your research, you’ve saved, now do more research to make sure the rates of the activities you want to experience have not fluctuated. Make sure you’ve planned for food, accommodations, entertainment, and travel expenses. Imagine a day in the life of your target country, and research every accommodation that you use to make yourself comfortable. Figure out a budget for all of it, and make sure your savings is going to cover every point.

Get Ready for a Change in Spending Habits

If you research the exchange rate and find that your home dollar goes farther in the foreign country, you may find that you can have more fun than you could at home. You might find that you can change your spending habits; however, it’s wise to use caution when this happens. This is why it’s important to do that research, write that budget, and stick to it closely. Avoid spontaneous purchases. If you plan to bring home souvenirs, work it into the budget and stick to that number. Don’t lose your head over a great exchange rate; you’ve come this far in your planning, keep it up to give yourself the best vacation possible.

Remember to Treat Yourself

You’ve worked hard to plan the perfect trip. You’ve planned a budget, tracked exchange rates, grabbed cash ahead of time from Xchange for America, and shared your itinerary with a trusted family member. Did you remember to work some form of special treatment for yourself into the equation? You’ve worked hard – remember to do something nice for yourself. Get a massage, visit a day spa, and reward yourself for using sites such as Xchange for America in your smart travel planning.

Countries with a Low Currency Exchange Rate Compared to the USD

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There are a number of countries with a low currency exchange rate relative to the US Dollar, meaning that many of these countries are a good option to travel to when you are trying to save the most money possible. The US dollar remains one of the strongest currencies in the world as a result of the relative strength of the US economy and a number of other factors, making it inexpensive to travel to several countries. With the proper trip planning you can end up saving thousands of dollars on a vacation to these countries compared to countries with a stronger local currency.

Dominican Republic

The Dominican Republic has one of the lowest currency exchange rates compared to the U.S. dollar, making it a more affordable country to travel to. There are plenty of things to do and places to visit in the Dominican Republic including some of the most beautiful beaches and oceanside resorts in the world. You can plan a vacation there and save a lot of money by making your currency purchase online. The Dominican peso is sold by Xchange of America and you can purchase it at a very reasonable rate compared to many other currencies. We can provide you with information about purchasing the Dominican peso from our website and help you plan your trip out so that you can save the most money possible.

Peru

The dollar remains strong compared to the Peruvian Sol, and you can purchase the Sol online from Xchange of America if you plan on traveling to Peru. The country is known for its delicious local cuisine and it is one of the top travel destinations in South America with its ancient Incan historic sites including the incredible Maccu Picchu, the Inca Trail, the city of Cusco, and many other archaeological sites that you can visit as a tourist. It is also home to a part of the Amazon forest. You can take many different types of tours in Peru and experience its great local food and more, and you can continue to benefit from a strong currency exchange rate if you buy their currency in the near future.

Mexico

Mexico offers one of the most favorable exchanges for the U.S. dollar, making Mexico one of the best travel destinations for Americans. The proximity of the country is also a major factor that makes it a very convenient travel destination, and you can purchase hundreds of pesos for a relatively low amount of US dollars at the moment. You can get more information about the current exchange rate which can often fluctuate a little bit on a daily basis, but it has been steady for some time with the peso being lower than the dollar for many years. This lower exchange rate has resulted in some jobs being outsourced to Mexico in recent years due to some lower labor costs, tourism there remains high as well.

For any of the countries mentioned above it is essential to travel to particular regions that are considered to be safe, and to follow the advice of a tourism expert as you plan your trip.

Political Events Can Affect the Currency Exchange Rate

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Political events are one of the biggest factors that affects currency exchange rates, and they can have a major impact on the particular value of a currency in a matter of minutes depending on what type of event occurs. As we saw with the recent Brexit vote in 2016, the value of the British pound dropped quite dramatically in a period of days, and then it quickly recovered. This type of currency shift is not the norm, but it’s always possible whenever a majorly impactful event occurs. No one can really predict when these fluctuations will happen, however when they do happen you may be able to save money on currency exchange.

Elections can affect currency exchange rates

One of the most common major political changes that can affect the exchange rate for a particular currency is an election. If the candidate is perceived by local business interests as possibly being good for business in the country, the currency exchange rate may jump up. This type of candidate is considered a “pro economy” candidate. Similarly the value of the stock market may also increase when a pro economy candidate is elected. On the opposite end, a candidate that is perceived as potentially increasing business regulation and restriction or one who would otherwise affect the business world with certain policies may result in a currency decline or a stock market decline.

Unexpected elections and political instability affect exchange rates

Another more uncommon political event that can affect the currency exchange rate is an unexpected election. This type of election can occur as the result of a scandal that resulted in the removal of a leader, a leader resigning, a corruption investigation or other types of unplanned election situations. This political instability can cause all kinds of havoc in the business world for a particular country. The political instability may have some potential long term benefits for a country, but in the short term many business people and traders will perceive the instability as being potentially harmful for business. As a result the currency exchange rate may have a rapid drop off, which can occur in a very short period of time.

Currency exchange rates usually rebound if they decline

When currency exchange rates do decline as the result of a political issue, in many cases they rebound once the political problem stabilizes, as it does in many cases. We saw this with the Brexit vote, as the value of the British pound largely recovered after it dropped following the vote. However, in other situations it can take a longer period of time for the value of a currency to recover. In any case, travelers and others can actually benefit from a decline in a currency exchange rate. They are often able to purchase larger amounts of the currency at the same price as before, making it cheaper for them to travel to the country in which the political event occurred. It can even be good for a country’s tourism to have a decline in their exchange rate, but there are other negative consequences as well.

How Much Does the Currency Exchange Rate Matter When Buying Currency?

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Although you might be considered about the currency exchange rate when purchasing currency for an upcoming trip or for any other reason, the reality is that the exchange rate won’t change dramatically over a short period of time. There aren’t that many circumstances where it will make a major difference in the amount of money that you’ll spend on your currency exchange, except if you are buying a relatively large volume of currency. At Xchange of America we exchange and ship physical currency, and if you are planning on buying a large amount of it, we can provide you with information on exchange rates so that you can save money.

Be sure to buy your currency if you’re leaving for a new country soon

If you are planning on leaving for a new country soon, it’s a good idea to go ahead and buy the currency that you need before you leave. This way you won’t be caught in a situation where you have to scramble at the last minute to find a local currency exchange. Don’t worry about trying to time your purchase for a favorable exchange rate, as it is not likely to change in a short period of time, and you’ll end up losing significantly more money by having to use an airport currency exchange.

The currency exchange rate can sometimes change quickly

In some cases, the currency exchange rate can change at a more rapid pace. This was seen last year when the Brexit vote occurred; the value of the pound dropped significantly in comparison to several other Western currencies. During this type of rapid currency drop, it can actually be a great time to purchase currency for a particular country, as you can get a lot more currency for each dollar that you spend. The drop in the British pound actually resulted in an influx of tourism, as the country became a lot more affordable for many people to visit. Although the currency exchange rate of the pound has recovered since then, there were a few weeks offering a great opportunity to buy that particular currency for traveling.

We can let you know about historically high or low exchange rates

If there are any historically high or low currency exchange rates for any particular currency you are considering purchasing, we can let you know about them ahead of time before you make your purchasing decision. In many cases, however, you are much better off purchasing your currency as soon as you can, especially if it’s for the purpose of traveling. In a few cases such as a bulk currency purchase it’s smart to request more details about how you can save money by timing your purchase and perhaps waiting until the currency exchange rate is more favorable, if it is expected to occur. In any case, you’ll save a ton of money on exchange fees by using Xchange of America, as we never charge you service fees, and you’ll get some of the best exchange rates that you can find.

Do You Need to Time Your Currency Purchase?

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You may be wondering whether or not you should time your currency purchase based on the current currency exchange rate for your main currency. You can certainly do this as a way to save money, but keep in mind that most types of fluctuations over a short period of time are usually quite minimal. You can easily find information about the historic currency exchange rate for any currency that you’re interested in purchasing, but in most cases it makes sense to make your purchase as soon as you can so that you can have your currency delivered ahead of any upcoming trip. This way you’ll be able to avoid using any last minute currency exchange option that may be expensive and inconvenient.

It won’t make much of a difference in your cost in the short term

If you don’t have much time before your next trip to a foreign country, trying to time your currency purchase for when the currency exchange rate is favorable won’t be all that effective. This is because of the fact that currency fluctuations are normally minimal over a short period of time. Larger fluctuations can happen over the course of several weeks. If you would like to time your currency purchase for when you’ll get more currency for the money that you spend, you can always contact us at 1-888-1800-1977 to get information on when you can expect to be able to purchase a higher amount of whatever currency you are aiming to buy.

Make sure you purchase your currency with time to spare

If you have just weeks to go before your next trip to a foreign country, you may as well make a currency purchase now so that you’ll have the currency that you need ahead of time and you won’t be stuck scrambling for an option at the last second. You don’t want to wait until the last few days before you leave to make your purchase because there’s no guarantee that your currency shipment will arrive in time. This will force you to have to use a local currency exchange where you’ll get some of the worst exchange rates, along with a huge range of fees in many cases that can make you end up spending significantly more than you need to.

We can provide you with currency exchange information

We can provide you with information on the daily exchange rate for any currency you’re interested in purchasing, along with the rate that you can expect to pay for your next purchase. If you don’t have much time before your next trip, you should strongly consider purchasing the currency that you need as soon as you get the next opportunity. We can let you know if now is a good time to purchase or if you should wait for a later date, assuming you have the time. We can also provide you with information about historic currency exchange rates so that you can make a more educated decision when you purchase currency for any purpose.

How Fluctuating Currency Exchange Rates Can Affect the Stock Market

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It isn’t common knowledge, but fluctuating currency exchange rates can influence the stock market. For example, in 2015 the Central Bank of Switzerland had a major impact on stock markets as they abandoned their policy of keeping the value above the Swiss franc down compared to the Euro. By the end of the 15^th, the franc was approximately 15% stronger than the previous day. Most types of currencies do not move more than a few percentage points each day so the franc’s change in such a short period time was massive. Several stock market companies took a major hit in the Swiss market, particularly companies with major exports like Nestle and Swatch.

Rising currency values make exports more expensive for buyers

This Swiss case study is an excellent example of how rising currency values can affect the stock market. Rising currency values make a country’s products more expensive for those who are buying them overseas. For example, the US dollar is weaker when the Swiss franc is valued higher, and Swiss watches and other Swiss products become more expensive for those in the United States. This usually results in consumers buying fewer products. Rising currency values often ends up being bad news for exporters. Also if any country heavily depends on exports, quickly rising currency values can be devastating to their stock market.

Rising currency values make sales numbers weaken

The other downside when currency exchange rates rise is that sales numbers become weaker for many exporters. For example, 1 million dollars in sales in a prior month will have a lower value if a currency becomes stronger in the following month. This means that sales numbers will be weaker if a currency keeps rising, and that also has a negative impact on stock market values in many cases. Switzerland has several companies that earn most of their revenue abroad and these companies had weaker sales numbers when their currency rose. For example, Nestle earns over 97% of its revenue from foreign countries outside of Switzerland.

Large companies can hedge against currency increases

This certainly does not mean that large companies are at the mercy of their central banks or their country’s currency exchange rates. For example, large companies can hedge to their exposure to currency changes by purchasing securities that increase in value when their country’s currency rises in value. There are also other ways to hedge against increases in currency values. On the other hand, importers, will often prefer their currency to be stronger because they can purchase more of other countries’ exports at a lower price. So, other companies may increase in stock value when currencies rise.

Many other factors influence stock market values

There are many other factors that play major roles in how stock market values rise and fall, but the currency exchange rate is certainly one of the biggest ones. If you are interested in learning more about currency exchange rates, or if you have any questions at all about buying currency or timing a currency purchase, be sure to contact us today.