A number of major Canadian retailers say that despite the rapid descent of the loonie, consumers should not expect to see an increase in prices during the December holidays.
The loonie fell to 80 cents US today for the first time since June 2005.
Kevin Groh, director of corporate affairs for Wal-Mart Canada, told CTV.ca that the strength of the loonie combined with better use of their supply network has allowed the company to have a record year in terms of price cuts -- about 30 per cent.
Groh added that because much of Wal-Mart's holiday product was purchased last January from suppliers, he expects the "momentum" from the price cuts to continue.
Considering the economic climate, "consumers need low prices more than ever," he added.
But Bruce Cran, president of the Ottawa-based Consumers' Association of Canada, said the rise in the dollar will impact the price of imported goods.
Unless, said Cran, the philosophy retailers put forth a year ago, when the dollar went over par, was true.
"They said they arranged the prices and paid for it (goods) a year before," Cran told CTV.ca
"On that basis we should be in for some very good deals assuming that they've been able to secure their goods, as they said they did last time, at prices that should be very favorable to both them and the consumer."
But Cran said it's a scenario that's unlikely to happen.
"The prices on most stuff never ever reflected the difference between the Canadian dollar and the U.S. dollar," he said.
Books and magazines in particular drew the wrath of Canadian consumers last year, as the American price on the jacket was often visibly lower than the Canadian -- despite the loonie's strength.
At Indigo Books and Music Inc., chief marking officer Deirdre Horgan said that book prices are set by publishers six to nine months ahead of the time they are put on the shelves.
"There's never been a better time to buy a book," she told CTV.ca Wednesday, noting that the average book was less than $20.
When asked if prices could change to reflect the drop of the loonie, Horgan said Indigo is "mindful of consumers" and would examine its promotional strategy at that time.
At HMV Canada, president Humphrey Kadaner said his company purchases 90 per cent of its product from Canadian suppliers and "there are no plans" to raise prices.
"We have the best prices we ever had," he told CTV.ca.
He said the majority of the product purchased from the U.S. is video games, which HMV only recently started selling. HMV Canada has rapidly made itself a major video game retailer in Canada, an industry that is expected to continue to grow.
Kadaner added that despite the economic downturn, HMV expects a stronger year than 2007, as this fall's release schedule features a number of A-list acts such as Guns N' Roses and Kanye West.
HMV Canada is the country's largest music retailer, according to Kadaner.
/>/>
