Emmanuel Macron’s shock decision to call parliamentary elections spooked the money markets and sent the currency falling to a two-year low against sterling at 84p.
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The French President gambled on a snap poll after his Renaissance party was thumped by Marine Le Pen’s far-right National Rally in the European elections.
It followed a pattern across the continent that saw mainstream governing parties haemorrhage votes to populists standing on anti-EU and immigration platforms.
In a late-night address, a reeling Mr Macron said he was dissolving the French parliament and calling elections because he wanted to “write history, not be driven by it”.
But his gambit could backfire if the National Rally replicates its successes on Sunday in the round of domestic polls on June 30 and July 7.
It could see Mr Macron serve the rest of his three years as President with the firebrand 28-year-old Jordan Bardella as Prime Minister – plunging France into instability.
Yet it does mean British holidaymakers cashing in their Pounds for Euros this summer will get more bang for their buck.
Ms Le Pen – who is expected to challenge for the top job in 2027 – said her party was “ready to exercise power, ready to put an end to mass immigration”.
Her party won 32 per cent of the EU vote, while Mr Macron’s group crashed to less than 15 per cent.
Meanwhile the far-right AfD party made big gains in Germany, as did Giorgia Meloni’s Brother’s of Italy party.
Macron dissolved France’s National Assembly and announced the snap election on Sunday.
He warned that the far-right are threatening the future of France and Europe.
He said: “The rise of nationalists, of demagogues, is a danger for our nation, but also for our Europe, for France’s place in Europe and in the world.”
In an address to the nation from the Elysee presidential palace, Macron told his country: “I’ve decided to give you back the choice of our parliamentary future through the vote.
“I am therefore dissolving the National Assembly.
“This decision is serious, heavy. But it is above all an act of confidence.”
If you do have a holiday booked and want to take advantage of the current rates, we’ve some tips on how to ensure you’re not short-changed at the exchange.
BUY AHEAD
Buying your foreign currency ahead of when you travel means you can search around for the best rates.
Don’t buy cash at the airport on the day – these are usually among the worst rates around.
According to FairFX, exchange rates at airports can be over 20% more expensive, meaning you could lose over £200 of cash for every £1,000 you change.
You’ll more often than not be able to get better rates at other places if you plan ahead.
Airport exchange desk rates are generally higher as they have a captive market among those changing cash last minute and don’t need to be competitive.
USE COMPARISON WEBSITES
Compare travel money companies online, including the rates and any fees, to find the best deal.
Factor in delivery costs and choose the option that gives you the most cash to spend on holiday.
If you have left it too late, you might still be able to order online and collect it at the airport.
You can use comparison websites such as MoneySavingExpert.com‘s TravelMoneyMax, where you can compare pick-up and pre-order rates.
DON’T USE YOUR CREDIT CARD
Never pay for travel money with a credit card.
Transactions like this are usually treated as a cash withdrawal.
This means you’re likely to pay a cash fee and have interest added even if you fully repay.
It’s best to always use a debit card or cash to buy currency.
What are the alternatives for spending abroad?
THERE are a number of specialist cards that can give you a great exchange rate and fee-free spending and cash withdrawals when abroad.
These cards include debit and credit cards and pre-paid cards, which allow you to pay abroad without fees or at a set exchange rate.
Check your debit card
You should always check the terms and conditions of your debit card to see if, on the off chance, you can use it abroad without any extra fees.
This can often take the pain out of having to buy currency ahead of time and rely on cash.
Your bank will automatically convert your transactions to the correct currency with the live exchange rate so ensure that you always pay in the local currency.
Chase, First Direct and Starling all offer fee-free spending when yous use their debit cards abroad.
Those without this capability could choose to link their bank account with Currensea’s Mastercard debit card via open banking.
Then when you spend or withdraw on the Currensea card, it charges your linked current account in pounds (via direct debit), avoiding the non-sterling transaction fees and ATM fees that most banks charge.
Travel credit cards
Travel credit cards allow you to spend money abroad without being hit by any fees or hidden charges.
But, they may still charge you for taking cash out.
We recommend the Barclaycard Rewards Visa because it doesn’t charge for using it abroad, and there are no fees for withdrawing cash if you pay off your bill in full each month.
You must always pay off your balance before the end of the month with these cards to ensure that any money you save isn’t wiped away by paying interest.
Prepaid card
An alternative to carrying cash or your debit card around is to get a pre-paid card.
Brands like Revolut, Wise and EasyFX all provide prepaid travel cards.
HSBC launched its Zing subsidiary in January 2024, which gives existing and non-HSBC customers access to a prepaid debit card without fees.
The card can hold up to 10 currencies and be used in more than 200 countries.
These cards allow you to put a set amount of cash on the card at a fixed exchange rate.
So if the rate is good now you can put money on your card, and it will stay that rate when you are on holiday.
But, these cards can sometimes have hidden costs and charges so be sure to read the small print.