Travel insurance customers could soon find that they are getting cheaper holidays, a foreign exchange firm has predicted.

The specialist company, HiFX, has suggested that the pound could soon become stronger against foreign currencies again, meaning trips abroad will be less expensive for British travellers. The prediction comes shortly after the European Central Bank confirmed that the pound was up 0.36% against the euro in mid-June.

Marc Cogliatti, a currency strategist with HiFX said that although the cost of holidays would go down, the exchange rate was unlikely to go back to the way it was two years ago: ‘In the grand scheme of things the pound is now 15 per cent higher now compared to where we were at the start of the year - that is obviously good news for holiday makers.’

It has been suggested that the current weakness of the pound against the euro is forcing travel insurance customers to look further afield to get a better holiday deal.