Loonie’s drop hits consumers, helps B.C. tourism

SFU's Lindsay Meredith sees Canadian dollar sliding to 70 cents

The Canadian dollar has slid more than 15 cents against the U.S. greenback from a year ago.

The loonie’s swoon is prompting more B.C. residents to rethink plans to vacation in the U.S., according to a new poll.

The Insights West online survey found 57 per cent of B.C. respondents said they’re more likely to vacation in this province and 53 per cent said they’ll make fewer trips to the U.S. than usual.

Seventeen per cent said they have already cancelled a planned trip to the U.S.

RELATED:Loonie at lowest point in more than a decade

The loonie sank this week below 77 cents U.S., a new low for the year following a 10-cent plunge last winter as oil prices fell.

Nearly two-thirds of those surveyed said the declining Canadian dollar has either a significant or medium effect on their travel plans

SFU business professor Lindsay Meredith said he’s not surprised by the trend of Canadians staying home and said he expects more Americans will come north as they realize their greenback goes farther here.

“Tourism is the big winner out of this, no question about it,” Meredith said. “The big losers are the Canadian consumers.”

The dollar dove after the Bank of Canada cut its interest rate in response to sagging economic growth, which also prompted a recalculation that the federal government is actually heading for a $1-billion deficit this year, rather than a budget surplus.

Meredith suggested the weaker dollar may aid federal government re-election hopes by propping up eastern Canadian export industries, but will be counterproductive to the economy elsewhere, because average families will have less money to spend as prices of U.S. goods climb.

“It adds more gas to the fire because the imports are much more expensive, so you’ve just shorted the Canadian pay cheque again,” he said.

It will become a “double whammy” when the U.S. federal reserve increases its interest rates, widening the spread against the cost of borrowing in Canada, and giving currency markets another reason to dump the loonie for the greenback.

“That will mean more devastation for the loonie,” Meredith said. “My prediction is we’ll go to 70 cents.”

Just Posted

Josie Hotel will be ready on opening day, says management

West Kootenay’s first ski-in, ski-out boutique hotel to open this month

Castlegar’s Waterline property purchased; owners to protect it for rock climbers

New owners plan to subdivide, sell bluffs to recreational climbing group

Rossland council’s first meeting sets appointments

Councillors assigned to sit on boards, committees on major city issues

Feds, B.C. to expand Darkwoods Conservation area

New funding allows the national land trust to add some 7,900 hectares to the Darkwoods Conservation Area

Good fencing makes good neighbours— especially when your neighbours are bears

Workshop in Pass Creek this weekend to promote benefits of proper protection for livestock

Josie Hotel will be ready on opening day, says management

West Kootenay’s first ski-in, ski-out boutique hotel to open this month

California wildfire death toll hits 63

Sheriff says hundreds still missing in nation’s deadliest wildfire

Harsh storms have nearly tripled power outages in last five years, BC Hydro says

More frequent and severe storms have damaged Hydro’s electrical systems since 2013

Trudeau to meet key Pacific trade partners at APEC leaders’ summit

Canada became one of the first six countries to ratify the CPTPP

Judge orders White House to return press pass to CNN’s Acosta

U.S. District Court Judge will decide on White House press credentials of CNN reporter Jim Acosta

WikiLeaks chief could see charges, US court filing suggests

Charges against Julian Assange could help illuminate the question of whether Russia co-ordinated with the Trump campaign

Federal MPs denounce controversial Facebook post targeting Sajjan

Okanagan Conservatives apologize for controversial Facebook post

Canada has enough pipelines to get the moon

Pipelines totalling 840,000 kilometres run across Canada

Migrants streaming into Tijuana, but now face long stay

U.S. border inspectors are processing about 100 asylum claims a day at the main border crossing with San Diego

Most Read