Travellers arrive at Montreal-Pierre Elliott Trudeau International Airport in Montreal, on Sept. 13.Christinne Muschi/The Canadian Press
Katie Flynn and Bhavik Mistry, both pharmacists from Ontario, had been saving for their months-long travel break since last year. The couple’s itinerary included sightseeing in Japan, Southeast Asia, Oman and parts of Africa, topped off with a whale shark-watching experience in the Maldives.
But now, just a few months into their trip, they’re feeling the squeeze from a weakened Canadian dollar and are adjusting their plans – even floating the idea of cutting the trip short.
“We’re really going to try to go to countries where the U.S. dollar is less of an influence,” Mr. Mistry said. “We really keep questioning: Can we afford to do this?“
Their strategy shift means cutting out Africa from their itinerary, as the U.S. dollar holds a lot of weight in places they planned to visit. They had saved roughly $60,000 for the trip, but now they figure their savings are worth about $2,000 less.
This need to rethink travel plans isn’t unique to long-term travellers. In recent months, the U.S. dollar has surged, driven in large part by the re-election of Donald Trump, pushing the Canadian dollar to its lowest exchange rate in four years. Many Canadians are re-evaluating their travel plans because of the challenges posed by a weakening loonie and waves of economic uncertainty.
The loonie has dropped about 2 per cent against the U.S. dollar since Mr. Trump’s win and roughly 4 per cent since September, when markets started readying for his potential return. Last week, the president-elect floated the possibility of imposing a 25-per-cent tariff on imports from Canada and Mexico, a move that would have “a major overhang” on the loonie, said Rahim Madhavji, the president and founder of Knightsbridge Foreign Exchange.
In light of this, Canadian travellers will need to get strategic, and they appear to be making changes already.
According to data from trip-booking site Expedia shared with The Globe and Mail, domestic travel interest for winter 2024-2025 has surged. Vancouver is leading the charge as a destination with a 33-per-cent jump year-over-year, followed by Quebec City and Victoria at 28 and 22 per cent, respectively.
For those who do choose to travel abroad, reducing currency exchange fees is a key consideration. Mr. Madhavji said his firm has been fielding a flurry of calls – “People are not just taking the bank’s word, they’re cost-conscious,” he said.
Currency services run by his company and the Canadian Snowbird Association earned praise from Globe readers who responded to a recent query from columnist Rob Carrick. Others found help from Wise, an app for managing payments and transfers in multiple global currencies.
Another thing that can really burn travellers already facing a weak loonie is paying with a regular credit card abroad, said Jason Heath of Objective Financial Planners.
He recommends really digging into travel cards that charge no foreign transaction fees. “You can also buy prepaid travel cards with different currencies ahead of time – Scotiabank’s Passport Visa Infinite Card has no foreign transaction fees, for example.”
Mr. Heath said Canadians looking to travel abroad can also benefit from a weakening Mexican peso, which dropped relative to the Canadian dollar this year. He also said the euro is pretty flat relative to the loonie.
Of course, in Mexico there will be competition with Americans and their stronger dollar. Chadd Andre, executive vice-president for Flight Centre Canada, a travel booking company, said he’s noticed travellers traditionally avoiding the U.S. in times like this, but he also recommends that those looking to save some money steer clear of destinations that are popular among Americans, such as Cancun and Puerto Vallarta, and go off the beaten path – for example, Ixtapa, Manzanillo and Huatulco.
Ms. Flynn and Mr. Mistry said they swear by budgetyourtrip.com, which lets travellers set a budget and find appropriate destinations.
A week in Portugal, a destination Mr. Andre recommends for stretching the loonie, can cost as little as $240 a day on average, including hotel, food and transportation, according to budgetyourtrip.com. (Though this will depend on the season.)
Ms. Flynn and Mr. Mistry also said they’ve been able to secure steep savings with credit card points and miles.
Recent analysis by The Globe found that the Scotiabank Gold American Express Card offered particularly good value when redeeming points for travel – one cent per point.
As for Ms. Flynn and Mr. Mistry, the couple are currently locked into a deal to go to Oman, where they paid for their visas in U.S. dollars. “From there onwards, we’re going to really try to select countries where the U.S. dollar doesn’t have as much influence,” said Mr. Mistry, adding that the loonie stretched furthest in Sri Lanka and Indonesia.