Britons' cash will go further in Australia, New Zealand and Canada

British travellers hoping to stretch their money as far as possible should head to the Commonwealth in light of sterling's dramatic slide against other currencies, according to currency expert FC Exchange.

The pound declined by 33.3 per cent against the euro and 36.2 per cent against the American dollar in the two-year period between March 2007 and March 2009, reports FC Exchange.

In comparison, it fell by a far less painful 19 per cent against the New Zealand dollar. In a similar vein, it dropped by 25 per cent against the Canadian dollar and 27 per cent against the Australian dollar.

"New Zealand, Australia and Canada are the three countries that still represent excellent value for money," said Nick Fullerton, managing director of FC Exchange. "They aren't in the thick of recession to the same extent as the UK and US," he added.

One other option for anyone looking to combat the erratic nature of the currency markets is the "forward contract". This involves customers locking up a favourable exchange rate by paying a 10 per cent deposit for a deal that lasts for up to two years. The balance can then be paid in full on the date agreed in the contract.