Visits to the USA have become more expensive due to the euro’s decline against the US dollar, with potential for the currencies to reach parity once again. The Euro is now worth 1.05 United States dollars.
Several factors contribute to the euro’s weakness, including low growth in the euro area, lower interest rates, and increasing political instability in major European economies. The dollar and euro last reached parity in 2022.
Inbound tourism is expected to benefit if parity is sustained, making Ireland more attractive to US visitors, our highest spending inbound market.
The importance of reaching a 1:1 exchange rate is significant for investors and could lead to increased volatility, with some banks predicting a weaker euro in the coming years.
While a weaker euro can stimulate export competitiveness, it also raises import costs, impacting inflation and consumer purchasing power, while benefiting the tourism sector from increased US visitors.
