{"id":193511,"date":"2011-12-13T11:03:00","date_gmt":"2011-12-13T11:03:00","guid":{"rendered":"https:\/\/swoop-patagonia.com\/blog\/2011\/12\/13\/193511-cost-of-a-holiday-to-patagonia-macroeconomic-influences\/"},"modified":"2011-12-13T11:03:00","modified_gmt":"2011-12-13T11:03:00","slug":"193511-cost-of-a-holiday-to-patagonia-macroeconomic-influences","status":"publish","type":"post","link":"https:\/\/www.swoop-patagonia.com\/blog\/193511-cost-of-a-holiday-to-patagonia-macroeconomic-influences\/","title":{"rendered":"Cost of a holiday to Patagonia: macroeconomic influences"},"content":{"rendered":"<p>&nbsp;<\/p>\n<p>With all the excitement of the Eurozone crisis and the extraordinary economic climate currently I decided it was time to dust off my old undergraduate textbooks on International Economics. I had intended to re-build a deep understanding of the influences on exchange rate movements, and critique the different theories on the competitive advantage of nations. In the end I decide to settle on 3 more down to earth questions:<\/p>\n<ol>\n<li>Will Argentinian inflation mean more expensive trips in the future?<\/li>\n<li>Why do Chilean opertors sometimes charge for their trips in Chilean Pesos when US dollars are the norm?<\/li>\n<li>Should we expect the dollar to pound exchange rate to impact the cost of Patagonian holidays for UK travellers?<\/li>\n<\/ol>\n<p>First of some high level data points:<\/p>\n<p><img decoding=\"async\" src=\"\/images\/3400\/original.png?1323777445\" style=\"display: block; margin-left: auto; margin-right: auto;\" \/><\/p>\n<p>Some people ask me why trips to Patagonia are more expensive than, say the Himalayas. Some of the answer lies above!<\/p>\n<p>So, question number one: <strong>with Argentinian inflation running at 10% (and twice that of the UK) can we expect the cost of holidays in Argentina to increase?<\/strong><\/p>\n<p>Answer: NO. Exchange rate movements (the devaluation of the Argentine Peso (ARS)) have meant that much of the inflation effect is kept in check. I think i may have referred to this effect as <em>Purchasing Power Parity <\/em>when I was at university.<\/p>\n<p><img decoding=\"async\" src=\"\/images\/3401\/original.png?1323777457\" \/><\/p>\n<p>&nbsp;<\/p>\n<p>Question number two: <strong>Is the Chilean Peso following the same trend as the Argentinian Peso? And why are Chilean trips often charged in local currency while others are charged in US dollars?<\/strong><\/p>\n<p>Answer: NO. The exchange rate of the Chilean Peso is far more volatile and, if anything, the trend is going in the other direction.<\/p>\n<p><b><img decoding=\"async\" src=\"\/images\/3402\/original.png?1323777466\" \/><br \/><\/b><\/p>\n<p>Question number three:<strong> Given that the majority of trips to Patagonia are priced in US dollars are exchange rates relative to the Pound going to have a meaningful impact on prices for UK travellers?<\/strong><\/p>\n<p>Answer: I don&#8217;t know! The dollar:pound exchange rate has been stable for the last couple of years, but in the current climate who know what might happen next.<\/p>\n<p><img decoding=\"async\" src=\"\/images\/3403\/original.png?1323777480\" \/><\/p>\n<p>Overall, what can we expect? I suspect more volatility and lots of unknowns, but the good news is that there&#8217;s no obvious underlying trend towards an increase in the real price of Patagonian holidays for UK travellers.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; With all the excitement of the Eurozone crisis and the extraordinary economic climate currently I decided it was time to dust off my old undergraduate textbooks on International Economics. I had intended to re-build a deep understanding of the influences on exchange rate movements, and critique the different theories on the competitive advantage of [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[6,18],"tags":[36,44,77,136,178,196],"class_list":["post-193511","post","type-post","status-publish","format-standard","hentry","category-commentary","category-travel-tips","tag-analysis","tag-argentina","tag-chile","tag-holiday","tag-macroeconomic","tag-patagonia"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Cost of a holiday to Patagonia: macroeconomic influences - Swoop Patagonia Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.swoop-patagonia.com\/blog\/193511-cost-of-a-holiday-to-patagonia-macroeconomic-influences\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Cost of a holiday to Patagonia: macroeconomic influences - Swoop Patagonia Blog\" \/>\n<meta property=\"og:description\" content=\"&nbsp; With all the excitement of the Eurozone crisis and the extraordinary economic climate currently I decided it was time to dust off my old undergraduate textbooks on International Economics. 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