The Canadian dollar rose to its highest level in two years, but it will probably take even more strengthening before Whatcom County retailers notice an increase in cross-border shopping.
The loonie ended Friday at just under 81 cents compared to the U.S. dollar. That’s the strongest finish since June 2015. According to an article posted on Bloomberg.com, one factor for the Canadian dollar’s rise Friday was the expectation among traders that the Bank of Canada will raise interest rates next week.
The Canadian economy is exceeding expectations, leading to the bullish outlook on the loonie, according to a story in The Globe and Mail.
The Canadian dollar has been bouncing between 78 to 80 cents since early July, much stronger than what it was in early May at 72 cents. The rise hasn’t translated into increased southbound border traffic, however.
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The 2017 southbound crossing totals in Whatcom County for June and July combined are 2.1 percent lower than the same period in 2016, according to data compiled by the Border Policy Research Institute at Western Washington University.
Whatcom County retailers shouldn’t expect much change in the southbound border-crossing numbers unless the loonie gets significantly stronger, said Laurie Trautman, director at the research institute.
The strength of the loonie has an effect on retail sales in Whatcom County. With the Canadian dollar spending much of the past two years under 80 cents, the local market appears to have adjusted, with Whatcom County residents spending more in the area.