Britons will pay more for everything they buy on their Christmas and winter breaks as the pound slumped to a record low against the euro.

Two years ago £100 bought 145 euros – today some travellers are picking up less than 100 euros for £100.

Many families will now have to cut holidays abroad next year, while those who have already booked will have to budget spending on items such as car hire, meals and drinks.

Yesterday the pound to hit 1.136 against the euro – the pound’s lowest value since the Euro was introduced in 1999.

The ‘tourist rate’ for the pound dropped to 1.07 euros. Travellers buying currency at airports were given even less – in some cases once commission is deducted, £100 is converts to 99 euros.

Britons take more than 30m winter and summer breaks in European countries where the euro is the currency. Winter breaks in France, Austria, and Italy resorts will be among the first to be hit.

Everything tourists buy abroad will be more expensive – from the taxi ride from the airport to drinks, food and car hire.

While the cost of package deals later this year is unlikely to be significantly affected by the change, holidaymakers will have to carefully count their euros while abroad.

Travel agents are holidaymakers stretch their pounds by recommending trips to non-euro countries like Turkey.

Against the US dollar the pound is at $1.48, down 25% since the start of the year.

Analysts believe the pound is falling so sharply because of growing fears over the recession gripping the British economy.

In the City, the FTSE opened at 4381 and fell 14 points to 4367. In New York, the DOW rose climbed from 8693 to 8761 – putting on an extra 68 points.

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Tags: British Pound, Budget, Currency Crisis, Euro, FTSE, Recession, UK Recession

The potential rout in national economies that is threatening to spread across Europe like a bush fire seems to be gathering pace as hungry and injured Hedge funds look on while licking their chops at the huge profits such a cascading currency crisis presents…and Iceland was just round one.

The former Soviet bloc is in the epicentre of the current round of frightening developments swirling around Europe…and Euro sceptics are rejoicing as the currency pegs that hold the now fragile Economies of Europe together look like being ripped out like tent pins in a hurricane.

After the rejection of the Lisbon treaty in Ireland, the EU ruling elite can ill afford a monetary strain on top of the political strain that has recently thrown the direction, if not the very existence of the EU, into doubt.  Should a serious test of the EU monetary system find Brussels wanting, their grand plans will lie in tatters and could force European countries out of the EU as resurgent nationalism destroys the great European unification process…the Grand Plan. Make no mistake; there is a very real danger here that that is precisely what will happen.

“This is the biggest currency crisis the world has ever seen,” said Neil Mellor, a strategist at Bank of New York Mellon.

European banks are heavily exposed to the upheavals in the emerging blocs on the fringe of Europe in Latin America and Asia. Ukraine, Serbia and Hungary are all at the IMFs door, cap in hand. Economies like Austria and Switzerland could follow as their liabilities to the emerging markets are over 50% of GDP.

Hans Redeker, currency chief at BNP Paribas, says there is an imminent danger that East Europe’s currency pegs will be smashed unless the EU authorities wake up to the full gravity of the threat, and that in turn will trigger a dangerous crisis for EMU itself.

“The system is paralysed, and it is starting to look like Black Wednesday in 1992. I’m afraid this is going to have a very deflationary effect on the economy of Western Europe. It is almost guaranteed that euro land money supply is about to implode,” he said.

Look out below.

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For More information on specific Banks use these links

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• Barclays
• Capital One
• Child Trust Fund
• First Direct
• HSBC
• Post Office
• Tesco Savings

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Tags: Currency Crisis, Euro, Europe, European Currency, Global Credit Crisis, Lisbon Treaty, Monetary System