The lower Canadian dollar will leave cross-border shoppers with less incentive to head south this holiday season.

The lower Canadian dollar will leave cross-border shoppers with less incentive to head south this holiday season.

Lower loonie to crimp cross-border shopping

B.C. retailers likely to benefit if currency gap prompts holiday shoppers to spend more money at home

The falling Canadian dollar may bring a merrier Christmas for local merchants and other small businesses by spurring B.C.’s legions of avid cross-border shoppers to instead spend their money at home.

Over the last two years the loonie has slid from $1.02 U.S. to around 88 cents and the decline has been close to 10 per cent from one year ago, when the Canadian dollar stood at 97 cents to the greenback.

“With the Canadian dollar being rock bottom it certainly makes any kind of retail prices in Vancouver look relatively more attractive,” SFU marketing professor Lindsay Meredith said. “A 12 per cent spread is a big number. That should certainly work in favour of the Canadian retailers.”

Canadian governments will also benefit by collecting more in sales tax, but Meredith said consumers will be the losers – whether they opt to pay the generally higher retail and wholesale markups in Canada or the higher exchange rate on their purchases in the U.S.

But he noted consumers should have a bit more money left in their pockets to spend this holiday season as a result of cheaper gasoline in the wake of the global drop in oil prices.

B.C.’s economy will also benefit in other ways from the lower dollar.

Besides making American imports more costly against Canadian products, B.C.-based exporters will benefit – particularly the forest industry.

“That can lead to more employment and more money to spend in retail,” Meredith said.

Then there are the tourism operators, who struggled to get Americans to come north when the loonie was riding high and their money didn’t go as far.

B.C. is now a bargain destination from the U.S. point of view.

“Operations like Whistler Blackcomb are loving this,” Meredith said. “And it’s perfect timing for the ski season.”

Even the panic over Ebola may actually be good news for Main Street B.C. if some winter vacationers decide it’s getting riskier to fly.

The deadly virus is likely to crimp demand for flights not just to Africa but also to Europe and prime snowbird destinations in the southern U.S., Meredith said.

“If that money stays home it’s more likely to be spent here.”

The Canadian dollar is well down from its recent highs against the U.S. dollar. Chart via xe.com.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Delta character - and former White Rock resident - Pansy May Stuttard inspects a loaded revolver in the cover photo for Jim Dwight and Gary Cullen’s fascinating biography, Lord don’t want me Devil won’t take me. Contributed photo
West Coast’s ‘Pistol-packin’ Pansy’ lives on in colourful biography

Infamous Delta character ended her days in White Rock and South Surrey

A science class at L.A. Matheson Secondary. March 2021. (Photo: Lauren Collins)
Reports of student attendance ‘dwindling’ at Surrey schools: teachers’ association

STA president said he’s heard from staff that students might not attend in-person for 4th quarter

Vancouver resident Beryl Pye was witness to a “concerning,” spontaneous dance party that spread throughout social groups at Kitsilano Beach on April 16. (Screen grab/Beryl Pye)
VIDEO: Dance party erupts at Vancouver’s Kitsilano Beach to the dismay of onlookers

‘It was a complete disregard for current COVID-19 public health orders,’ says Vancouver resident Beryl Pye

Deputy Prime Minister and Minister of Finance Chrystia Freeland responds to a question during Question Period in the House of Commons Tuesday December 8, 2020 in Ottawa. The stage is set for arguably the most important federal budget in recent memory, as the Liberal government prepares to unveil its plan for Canada’s post-pandemic recovery even as a third wave of COVID-19 rages across the country. THE CANADIAN PRESS/Adrian Wyld
Election reticence expected to temper political battle over federal budget

Opposition parties have laid out their own demands in the weeks leading up to the budget

Chilliwack Search and Rescue volunteers say that a call on April 17 on Vedder Mountain was affected by bikers who rode through the rescue site, throwing rocks onto members and the patient. (Chilliwack Search and Rescue image)
Chilliwack Search and Rescue team, and patient, sprayed with rocks and dirt during rescue

Volunteer crew speaks out after riders on Vedder Mountain show no courtesy at accident scene

File photo. THE CANADIAN PRESS/Graeme Roy
One man dead after shooting in Downtown Vancouver

This is Vancouver’s fifth homicide of the year

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

A syringe is loaded with COVID-19 vaccine at a vaccination clinic run by Vancouver Coastal Health, in Richmond, B.C., Saturday, April 10, 2021. THE CANADIAN PRESS/Jonathan Hayward
B.C. to open up COVID vaccine registration to all B.C. residents 18+ in April

Registration does not equate to being able to book an appointment

(Black Press file photo).
Multiple stabbings at Vancouver Island bush party

Three youths hospitalized after an assault in Comox

Selina Robinson is shown in Coquitlam, B.C., on Friday November 17, 2017. British Columbia’s finance minister says her professional training as a family therapist helped her develop the New Democrat government’s first budget during the COVID-19 pandemic, which she will table Tuesday. THE CANADIAN PRESS/Darryl Dyck
B.C. finance minister to table historic pandemic-challenged deficit budget

Budget aims to take care of people during pandemic while preparing for post-COVID-19 recovery, Robinson said

Police tape is shown in Toronto Tuesday, May 2, 2017. Statistics Canada says the country's crime rate ticked up again in 2018, for a fourth year in a row, though it was still lower than it was a decade ago. THE CANADIAN PRESS/Graeme Roy
CRIME STOPPERS: ‘Most wanted’ for the week of April 18

Crime Stoppers’ weekly list based on information provided by police investigators

Most Read