Movements in exchange rates this week provide yet more bad news for Britain's hard-pressed package holiday companies. Most worrying was the fall of the value of the pound against the dollar. After hitting a peak of dollars 2 to the pound last month, the rate dropped to dollars 1.70 and could fall further. Operators pay for their charter flying and fuel in dollars. Those who have not bought currency ahead as a safeguard, could face significant losses.

Bookings for next summer are already well below expectations, forcing Thomson and Owners Abroad - the two biggest operators - to cut the prices of over 60,000 1993 summer holidays.