First Rate Exchange Services (First Rate) is anticipating strong demand for US dollars during the next month as sterling’s rising strength against the dollar makes New York an attractive destination for UK bargain hunters wanting to save cash on Christmas gifts.
First Rate’s largest foreign currency retailer is the Post Office and its comments follow the publication of the Post Office’s annual Christmas Shopping Guide which has revealed that shoppers can save an average of 20 per cent on gifts in New York compared with London (www.postoffice.co.uk/shoppingguide2009).¹
Gordon Gourlay, Managing Director, First Rate said: “Our foreign currency retailers have reported a sharp increase in demand for US dollars during October, as sterling started to strengthen against the currency, currently standing 12.7 per cent up the same time last year. This, combined with the availability of some extremely competitively-priced short breaks2, means we’re expecting even greater demand from transatlantic travellers in the run up to Christmas.”
In the survey of prices for 10 of this year’s ‘must-have’ gift items, the biggest New York savings were on True Religion jeans (£119.21) and Elizabeth Arden Eight Hour Cream (£11.79) – both costing at least 46 per cent less than in London.
The survey revealed that local prices have risen one per cent year-on-year in London and New York. However the improvement in the sterling exchange rate, which has risen by over 23 per cent compared with its low point in March this year, means that the New York shopping basket is actually four per cent cheaper than 12 months ago.
For the first time this year, the survey also compared prices for the most sought-after Christmas toys, establishing a 27 per cent differential between London and New York3. Five toys named by a leading UK retailer as 2009’s top sellers cost £183 in London but only £133.03 in New York.
Changes this year to the duty free regulations mean that holidaymakers can now bring back more gifts back from the USA because the duty free allowance has more than doubled to £340. Christmas shoppers should also remember that additional savings can be made by shopping in stores like Bloomingdales, which offer an 11 per cent discount to UK visitors to offset the 8.875 per cent New York sales tax