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When to buy Euros
14 Answers
Following on from an earlier question regarding buying currency, we will need some euros later in the year. Is it best to buy them now, whilst the rate is good, or wait - and what happens if the euro collapses and we have already got them, will we still be able to use them? We shall be going to Germany definitely, possibly elsewhere as well.
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I just said "be careful"
Here's Simon Calder's advice, which rojash may agree or disagree with:
Simon says: I am also off to Greece, and following political developments in Athens with interest — but not alarm. On Friday I bought euros for the trip, to lock in to the best exchange rate since 2008 (though it could improve still further in sterling’s favour). But because of all the uncertainty in Greece, I took two precautionary steps. The first was to add an extra €100 to my estimated spending; normally I rely on plastic for emergencies, but were Greece to leave the euro, electronic banking could freeze for up to a week and prevent debit and credit card transactions.
Next, I insisted on €5, €10 and €20 notes. The most likely form for a new currency is an overprinted “Greek” euro, whose value relative to the “real” euro would fall by perhaps 40 per cent. While traders sort themselves out, and before a market in the Greek currency begins, tourists are likely to pay in euros but be given change in new money. Pay for a €15 round of drinks with a €50 note, and you could get back change in Greek currency worth only €20. That is why low-denomination notes are so useful.
If Greece leaves before your trip? The euro is still the best currency. Moneychangers will spring up everywhere, offering keen rates, and you will be able to change euros to the new Greek currency in modest amounts as you go.
Here's Simon Calder's advice, which rojash may agree or disagree with:
Simon says: I am also off to Greece, and following political developments in Athens with interest — but not alarm. On Friday I bought euros for the trip, to lock in to the best exchange rate since 2008 (though it could improve still further in sterling’s favour). But because of all the uncertainty in Greece, I took two precautionary steps. The first was to add an extra €100 to my estimated spending; normally I rely on plastic for emergencies, but were Greece to leave the euro, electronic banking could freeze for up to a week and prevent debit and credit card transactions.
Next, I insisted on €5, €10 and €20 notes. The most likely form for a new currency is an overprinted “Greek” euro, whose value relative to the “real” euro would fall by perhaps 40 per cent. While traders sort themselves out, and before a market in the Greek currency begins, tourists are likely to pay in euros but be given change in new money. Pay for a €15 round of drinks with a €50 note, and you could get back change in Greek currency worth only €20. That is why low-denomination notes are so useful.
If Greece leaves before your trip? The euro is still the best currency. Moneychangers will spring up everywhere, offering keen rates, and you will be able to change euros to the new Greek currency in modest amounts as you go.
I disagree
I suspect what will happen is a paralell economy would spring up.
People will continue to take Euros - preferentially where they can in much the same way the US dollars are preferred in some countries.
If Greece leaves the Euro, they will not be able to borrow money as they'll be in default.
Consequently they'll be forced to print money and the new dracma will devalue rapidly and repeatedly.
In that circumstance people will jump ship and boycott it where they can.
I suspect hat if it does happen then it will serve as a warning to countries like Spain and Italy and that their populations will see what would happen if they were to leave too, they'll then move heaven and Earth to stay in
I suspect what will happen is a paralell economy would spring up.
People will continue to take Euros - preferentially where they can in much the same way the US dollars are preferred in some countries.
If Greece leaves the Euro, they will not be able to borrow money as they'll be in default.
Consequently they'll be forced to print money and the new dracma will devalue rapidly and repeatedly.
In that circumstance people will jump ship and boycott it where they can.
I suspect hat if it does happen then it will serve as a warning to countries like Spain and Italy and that their populations will see what would happen if they were to leave too, they'll then move heaven and Earth to stay in
I'm obviously not an expert, but as I live in Greece and get paid in a mixture of currencies, I take a pretty close interest. I'd agree with Simon Calder.
As for "sitting there with valuable Euros", in the event of Greece crashing out, I doubt if the Greeks will treat foreign Euros any differently from Greek Euros. The most likely result will be that you find yourself with (as far as the Greeks are concerned) devalued "Greek Euros" regardless of the country that printed them. And I also suspect that you'll have trouble taking them out of the country.
As for "sitting there with valuable Euros", in the event of Greece crashing out, I doubt if the Greeks will treat foreign Euros any differently from Greek Euros. The most likely result will be that you find yourself with (as far as the Greeks are concerned) devalued "Greek Euros" regardless of the country that printed them. And I also suspect that you'll have trouble taking them out of the country.
Agree with jno and his followers.
A couple of other points:
1) It isn't going to suddenly happen that we wake up to discover on the news that Greece has dropped out of the Euro - this (WHEN it happens - not IF it happens) is going to take some planning. In the meantime there is every prospect of the Pound strenghtening further against the Euro.
2) What to do with the Euros stuck in Greece is going to tax greater minds than others. Something similar to overprinted Euros with the words 'Greek devalued interim Euro' seems certainly possible whilst the great minds work out the permanent solution. The point about that is one will have to take 'kosher' Euros into Greece - not rely on the hole-in-the-wall machines. But that will only apply in Greece - not if travelling to the rest of Eurozone.
A couple of other points:
1) It isn't going to suddenly happen that we wake up to discover on the news that Greece has dropped out of the Euro - this (WHEN it happens - not IF it happens) is going to take some planning. In the meantime there is every prospect of the Pound strenghtening further against the Euro.
2) What to do with the Euros stuck in Greece is going to tax greater minds than others. Something similar to overprinted Euros with the words 'Greek devalued interim Euro' seems certainly possible whilst the great minds work out the permanent solution. The point about that is one will have to take 'kosher' Euros into Greece - not rely on the hole-in-the-wall machines. But that will only apply in Greece - not if travelling to the rest of Eurozone.
jake, the problem isn't what happens if Greece has already left the euro - when you can plan as you would for any other country - but what happens if you're there when it does so. It's going to mean a period, hopefully short, of currency chaos, when shops and restaurants don't quite know what's going on, and this could make a mess of a tourist's holiday. That's why I said to be careful and pasted Calder's advice.
For Germany, this won't be a problem any time soon. I don't know what other countries jamesnan plans to visit. But I am going to the eurozone next month and I'm waiting before buying euros.
For Germany, this won't be a problem any time soon. I don't know what other countries jamesnan plans to visit. But I am going to the eurozone next month and I'm waiting before buying euros.
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