Are Canadians Getting Value For Their Higher Dollar?
Posted September 19, 2007 12:00 pm.
This article is more than 5 years old.
What’s the difference between the Canadian dollar and Superman? The Canadian dollar isn’t weakened by kryptonite. The buck of steel had another good day Wednesday, closing at 98.50 cents US. It came after the loonie had soared past the 99 cent mark in overnight trading before the markets here even opened.
So does this mean you’ll be able to buy American-made goods here for less? Don’t get in your car for the mall just yet. It turns out that while the Canadian and American dollars are within parity of each other, you may not find a lot of value here.
Even though the loonie is going strong, Canadians are still paying more for products that you’ll find in both countries. And some economists say it’ll take up to two years for those prices to even out.
Your best bet may be that old cross border shopping routine, although patriots will tell you to buy Canadian. Some analysts believe Canucks making a run for the border with a fistful of dollars will be able to find good deals on luxury items like electronics and iPods. And you can drive a hard bargain on cars. One example? A fully loaded 2007 Lexus RX350 is about Cdn$45,000 down south. Buy it here and prepare to fork over at least $63,000 – an $18,000 difference.
“I think the combination of good deals at the outlet malls and the strong Canadian dollar, makes you come to Buffalo,” said one shopper.
But wait, this monetary magic trick isn’t over yet. Some experts predict the Canadian dollar could even surpass its U.S. counterpart, turning the tables and potentially letting our money buy more than theirs, making the Great White North a decided shade of green.
It has been a long and steady climb for the Canuck buck over the last several years. But rarely has the loonie shown the strength it has in recent weeks. Here’s a look back at the progress of the dollar over the year and how it’s gradually inched up, month-by-month, using the 19th of the month as a benchmark . (Expressed in U.S. cents)
Jan. 19: 85.32
Feb. 19: 85.92
March 19: 85.09
April 19: 88.61
May 18: 91.88
June 19: 93.99
July 19: 95.91
August 17: 94.03
September 18: 97.69
To track the dollar’s daily progress over the last 10 years, click here.
Source: Bank of Canada
