Tuesday, May 18, 2010

FX Forecasting


For about two months before the departure date, I watched the FX market.

The hardest part, for me, is deciding when stop playing the FX market. Despite the wholesale exchange rate, most consumers will have a higher rate since the majority of financial institutions (banks, FX desks) charge a fee. However, your personal bank, if it has a foreign or international department, will almost always give you a better rate than a FX desk at an airport or other places.

The other issue is determining the amount of cash you want to have on you. For hotels and tickets, I prefer using a card. Many smaller merchants prefer cash, so if you hope to go off the beaten track, bring some cash.

A credit card is more secure to me (if lost/stolen, call the company and cancel it. Cash? Eh, not so much). My preference has always been either cash or credit card. Traveler's Checks are more secure, but to me, convenience weighs in higher (and always: constant vigilance and monitoring of my personal things).

Keep in mind: many of the hostels around the Tour du Mont Blanc do not accept Carte Blanche (a credit card) since there is little need to in the middle of a mountain pass. Save the credit card for larger cities such as Chamonix or Courmayeur.

Right now, I have estimated expenses at:
Tickets (Train/Plane to Barcelona): 150
Accommodations on Mont Blanc (8 days camping at ~15/night): 120
City accommodations (21 days in hostels for 15-20/day): 370
Food (30 days for ~5 breakfast, ~10 lunch, ~15 dinner): 900

Round up to ~1500 Euro per person. Exchange rate $1.22:1Euro

From the WSJ:

More EUR Weakness Ahead - But the Worst is Likely Behind

John Hydeskov, Senior Analyst, Danske Bank

In several issues of FX Forecast Update we have written about the risk related to the debt situation in the PIIGS countries. Admittedly however, we did underestimate the impact on the FX market – not least on EUR/USD. We revised our 3M EUR/USD forecast lower on 28 April to 1.27, see FX Research: The good, the bad and the ugly EUR scenario, but as
EUR/USD is currently trading below 1.24 – a level not seen since the beginning of 2006 – the revision was obviously too modest. See the grey boxes below for a detailed insight into EUR/USD going forward.


Sunday, May 2, 2010

Adjusted Itinerary

We did not purchase our tickets until less than a month remained before our planned departure date. Though prices did not deviate dramatically, cheaper options began dwindling fast (and the transfer options were getting worse and worse). With some quick searching using AmericanExpress.com Travel (loyal AmEx holder here :)), we purchased two multi-destination tickets.

On that note, AmericanExpress always has been my top choice for airline tickets. An account is not required, but by providing your email address, they send you instant updates on flight changes and cancellations, if that happens. They do not charge a convenience fee, and the price displayed is the total you would pay, taxes and fees all-inclusive.

Also, the service is amazing. Last time my flight times changed and my connecting flight left BEFORE I arrived at the connection. I called AmEx, who started to work immediately on the problem. Instead of connecting me directly to Delta, they went on hold for me and called me back after everything was settled. I love the people there. :)

While round-trip tickets appear the most cost-effective, it really depends on the itinerary. For us, we prefer convenience over saving a bit of money. Had we been leaving Europe right after hiking, we would have round-tripped from Geneva. But Spain calls, so we flew out of Barcelona for a bit more money but a nice cap to the journey.