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The U.S. dollar hit a 30-year high in 2019, granting Americans some of the strongest purchasing power in the world. And while there’s no guarantee that the high will last through all of 2020, there are some destinations where the U.S. dollar is particularly powerful compared to the undervalued local currency—and the exchange rate is therefore the most advantageous it’s been in decades.[st_content_ad]
Destinations Where the U.S. Dollar Is Strongest in 2020
Here’s where the U.S. dollar is strongest right now, so you can make your next bucket-list international getaway an affordable one. While these exchange rates are high now, CWT’s Global Travel Forecast notes: “The Global Uncertainty Index, a barometer of unpredictability in 20 countries, reached a record level in 2019,” and reports that the U.S. dollar is predicted to fall in 2020.
Editor’s note: The Economist’s Big Mac Index, a measure of world currencies based on the average local cost of a McDonald’s Big Mac, was used to compare currency rates for this story—you can find the methodology here. All currency exchange rates were correct at time of writing; to see up-to-date conversions, check XE.com.
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Political instability is often the harbinger of an economic downturn, and therefore an advantageous exchange rate for Americans—and Chile is a prime example of this. After massive protests broke out in the Chilean capital in 2019 when subway tariffs were raised by the government, the value of the peso dropped significantly. It reached the lowest point it’s seen in the past two decades, making Chile one of the places where the U.S. dollar is strongest right now.
According to The Economist’s Big Mac Index, the Chilean peso is 33.3 percent undervalued against the U.S. dollar. The cost of a four-star hotel in Santiago ranges from $30 to $180 per night, and average mid-range meals are only several U.S. dollars, according to PriceofTravel. And Santiago is just a jumping-off point for the nation’s Torres del Paine National Park, Andes Mountains, Easter Island territory, and more.
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The United Kingdom
If England doesn’t sound like it belongs on a list of places where the U.S. dollar is strongest, consider how low the value of the pound has wavered since Brexit—especially as the finality of Britain leaving the E.U. approaches this year. According to the Big Mac Index, “a Big Mac costs £3.29 in Britain and US$5.74 in the United States. The implied exchange rate is 0.57. The difference between this and the actual exchange rate, 0.80, suggests the British pound is 28.5 percent undervalued” against the U.S. dollar.
Only time will tell which way the pound goes as Brexit comes to a head under a new government. To avoid the price gouge of London, head for up-and-coming English gems like culture-forward Manchester, historic Bath, or coastal Brighton. And of course, the pound has the same value in other U.K. capitals like Edinburgh, Cardiff, and Belfast.
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After last year’s election of a new president, Brazil saw a drop in the already-low value of its currency; the real reached its lowest level since 2016 and is worth about half what it was valued at a decade ago. Beyond the fact that Brazil recently nixed its pricey entry visas for Americans (read: it’s now free to enter the country), according to the Big Mac index the Brazilian real is 20 percent undervalued against the U.S. dollar. PriceofTravel says that Sao Paulo four-star hotels range from $80 to $300 per night, and average budget meals are under $10—although luxurious experiences like Michelin-star restaurants are surprisingly affordable, too.
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There’s never been a better time to book a Nile River cruise or gawk at the Pyramids of Giza, as Egypt rebounds from its tourism drought with its currency still low. Since Egypt’s pound tumbled in 2016, it’s remained at the lowest level in decades: The Big Mac Index suggests that the Egyptian pound is 56 percent undervalued against the U.S. dollar. Average meals can cost as little as a few dollars, and four-star hotels in Cairo range from $57 to $130 per night according to PriceofTravel.
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While the euro is trending low compared to past years, there are even more affordable currencies to take advantage of in Europe—like Hungary’s forint, which makes colorful Budapest’s thermal baths, castles, and surrounding vineyards a steal. According to the Big Mac Index, the Hungarian forint is 46 percent undervalued against the U.S. dollar. Meals are a few dollars, and beer and wine are particularly cheap; four-star hotels in Budapest range from $40 to $119 per night, according to PriceofTravel. Flat and central Pest’s options are typically slightly more expensive than green, hilly Buda’s larger hotel options.
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A bucket-list destination that’s long been affordable, India’s rupee is 54 percent undervalued against the U.S. dollar, according to the Big Mac Index. The extreme air pollution that hits India’s capital of Delhi each fall typically disperses by winter, and Delhi four-star hotels range from $30 to $126 per night according to PriceofTravel. Other cities to add to the itinerary include Agra for the Taj Mahal, Jaipur for pink palaces, and Mumbai for coastal wonders like the Elephanta Island cave temples.
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Our neighbor to the north has had an advantageous exchange rate for Americans since the U.S. dollar’s value rose above it in 2015. Costs will of course vary depending on the city, but the Canadian dollar is about 10 percent undervalued against the U.S. dollar according to the Big Mac Index.
Ontario and Quebec are generally the more affordable Canadian provinces (especially when compared to pricey British Columbia) and home to city cultural getaways like Montreal, Quebec City, and Toronto. For a bucket-list nature getaway that’s affordable, consider the Maritime Provinces: New Brunswick (for the otherworldly Bay of Fundy), Nova Scotia, and Prince Edward Island.
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The nation that straddles Europe and the Middle East, Turkey is a bucket-list spot that’s still popular among tourists despite its political instability of late—and it’s seeing a resurgence compared to its drop in visitor numbers in years past.
Bustling Istanbul is a cultural hub that attracts artists and adventurers alike, while Aegean coastal cities like Izmir are perfect for food and wine getaways to affordable vineyard hotels. The Big Mac Index suggests the Turkish lira is 57 percent undervalued against the U.S. dollar, and Turkey also ranked as one of SmarterTravel’s cheapest places to fly in 2020.
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A surprising but strong contender for places where the U.S. dollar is strongest, New Zealand’s dollar is 26 percent undervalued against the U.S. currency, according to the Big Mac Index. That’s the lowest New Zealand dollars have dipped in over 15 years—making the island nation an affordable Southern Hemisphere option for anyone who wants to turn winter into summer—or vice versa.
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For more ideas, see The Top Travel Destinations for 2020.
More from SmarterTravel:
- 11 Luxury Destinations that Are Cheaper Than You Think
- The 10 Cheapest Places to Fly Right Now
- The 10 Countries Where Your Spending Money Will Last the Longest, Ranked
Editor’s note: A prior version of this story inverted the descriptions of Buda and Pest in Hungary. It has been corrected.
SmarterTravel’s Shannon McMahon writes about all things travel. Follow her adventures on Instagram @shanmcmahon.