In 2025, a strong pound means your money could go further in lots of places. While sterling’s road ahead may be rocky against the US dollar, 23 of our best-selling 30 currencies have weakened against the pound since last March. In today’s release of the report, it states: For the 19th annual Post Office Travel Money Holiday Money Report, we surveyed 47 destinations to create our biggest ever barometer of costs. It found prices for food, drinks and other things tourists buy have gone down in around half of those we also looked at in 2024.
The Algarve is the best value spot again after nine years. But long-haul spots like Cape Town, Tokyo and Bali offer some of the lowest prices for UK travellers, taking five of the top six places. 2025 is already shaping up to be a buoyant year for overseas travel as British holidaymakers again demonstrate that taking a trip abroad is a bigger priority for them than many other lifestyle choices. New research by Post Office Travel Money for the 19th annual Holiday Money Report reveals that many more Britons are planning holidays abroad than in the UK.
Furthermore, well over two-in-five of those planning to travel abroad have gone ahead and booked their trip, with more than one-in-five intending to budget more for their holiday than in previous years. The research also illustrates the changing face ofholiday travel. While significant numbers will take beach holidays or city breaks and prefer the idea of ‘safe’ travel, an adventurous streak has revealed itself in the attitudes of some holidaymakers. Over a quarter of those surveyed told Post Office Travel Money that they are now planning to take some form of activity holiday.
The factors that might influence destination choice or shed light on the type of holiday they intend to take in the coming year are highlighted in the latest Holiday Money Report. The latest currency sales statistics from Post Office Travel Money, the UK’s largest provider of foreign currency, are a useful indicator of where Britons are choosing to visit. Sales trends over the past year indicate a growing demand for travel further afield to long haul destinations – particularly Far Eastern and South American ones. Another consideration may be the value of sterling.
Although it has proved volatile in the wake of the US presidential election, sterling remains strong against many currencies. Over three-quarters of Post Office’s top 30 currencies – including the euro and most other European currencies – have weakened since last March. This could provide holidaymakers with a big incentive to choose destinations where sterling will provide more ‘bang for their buck’.
Establishing the cost of holiday living is another valuable tool to help holidaymakers decide where they will get the most for their money. The latest Worldwide Holiday Costs Barometer – the biggest yet with 47 destinations – reveals that prices have fallen in around half of the resorts and cities surveyed. This includes the Algarve, which returns to the top spot for the first time since 2016, as well as a trio of old favourites – Prague, Thailand and the Costa del Sol, which are back in the best value top 10 after a lengthy absence.
Best value destinations 2025: key findings
The Algarve in Portugal is the cheapest holiday destination this year, thanks to low-cost meals and drinks. A three-course meal for two with wine costs just £40.33
Cape Town, South Africa, retains second place, despite an 11% rise in prices compared to last year
Tokyo, Japan, moves up to third place, though prices have increased by 7.4% year-on-year
Bali climbs to fourth place, with a total holiday cost of £68.88, up 5% from last year
Delhi, India, jumps from 13th to fifth place, thanks to a 10%.7 drop in local prices
Prague, in the Czech Republic, re-enters the top 10 in eighth place, after a fall in prices of over 20%
Hoi An, Vietnam, drops from first to seventh, as local costs rise by 41.3%
Phuket, Thailand, returns to the top 10, ranking ninth, with a 2.7% decrease in costs
Punta Cana, Dominican Republic, sees the biggest price drop, falling 26%. It’s the only Caribbean destination to make the top 20
New York is the most expensive city in the survey, with costs rising 15.6% to £167.85
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