By Barry Hatton
LISBON, Portugal — Vacations in Europe have a new attraction: the euro’s steep drop in value is making the continent much cheaper for tourists from across the world, especially the United States.
For American tourists, the dollar’s strength translates into a discount of around 25 percent compared with this time last year. And eurozone residents feeling the pinch from their sluggish economies are more likely to stay inside the bloc, where they won’t feel the currency changes.
That means the ingredients are in place for “a great year for tourism” in Europe, says Nick Greenfield, head of tour operator relations at London-based European Tour Operators Association.
The euro has fallen against many currencies in recent times, but its drop has been particularly pronounced against the dollar. The euro was trading at $1.057 on Wednesday, having been as high as $1.40 a year ago. Tim Cooper, a global economist at BMI Research in London, says his company expects the euro and dollar to reach parity later this year.
The European Central Bank’s policies have been weakening the euro, while those of the U.S. Federal Reserve have been bolstering the dollar. The euro has also been dragged down by fears over Greece’s debts and the bloc’s muted economic growth.
U.S. bookings to some European countries have risen by up to 20 percent so far, European tourism officials and American travel companies report.
Lyssandros Tsilidis, president of the Hellenic Association of Travel and Tourist Agents, said Greece has seen a 15-20 percent increase in reservations from the U.S. — Europe’s biggest long-haul market — compared to the same time last year. Spain saw a 12 percent increase in January and almost 19 percent in February. Officials anticipate more growth.