The strong Australian dollar has international travellers happy, driving down the price of hotel accommodations, car hires, meals and more at most destinations abroad, and giving credit card rewards schemes members excellent reasons to cash in their points for flights.

The lower prices are encouraging tour packagers to offer discounts. This combined with historically low airfares have raised the number of people travelling overseas by 8.5% from this time last year, according to figures recently released by the Australian Bureau of Statistics. The biggest gains were seen in trips to the U.S., U.K., Fiji, New Zealand, and Indonesia.

Some tour packages to the U.S. have been discounted by as much as 22%, capitalising on the Australian dollar’s 32% gain this year against its U.S. counterpart, while some Christmas holiday flights to London have fallen by $1000 from last season.

But with the business cycle turning and the Australian economy once again on the rise, experts are warning low airfares may not last and the time to book for next year is now. The prices on some of those cheap Christmas flights are already starting to rise, and booking at the last moment in hopes of better deals could backfire.

The dean of international business travel, American Express, is predicting rising Australian demand and decreasing supply will cause a 7% hike in business class fares and a 6% one for domestic and economy fares in 2010.

Bookings software network Amadeus is also predicting that Aussie airfares have bottomed and will soon start to rise, based on an 8% increase in reservations in August 2009 compared to August 2008. Rising demand naturally increases prices.

Source: News.com.au