High dollar buys shoppers joy
Sunday Star Times | Sunday, 15 April 2007
Importers' fierce competition means they must pass on their savings to consumers, reports Adam Dudding.

The soaring New Zealand dollar is driving exporters to the wall - and shoppers to the malls.

Importers are picking up bargains abroad and swiftly passing savings on to consumers, driving down prices on everything from foreign holidays to plastic buckets to flatscreen TVs.

Experts say punters ready to drive a hard bargain could do well even on high-value goods such as cars whose prices are traditionally stable.

But the Reserve Bank is expected to lift interest rates this month in a bid to rein in the shopping spree. The Kiwi dollar last week topped US73c, 20% higher than a year ago, and exporters, whose foreign earnings appear paltry once converted into New Zealand dollars, are feeling the pain. This month, Canterbury manufacturers Click Clack and GL Bowron said they were shedding 140 jobs.

But importers are more sanguine, and point to the benefits for consumers.

"Clothing, electronics, groceries - anything in a shopping mall will come down in price," said Daniel Silva of the Importers Institute. He said while importers might dream of pocketing the proceeds when a strong dollar drives down costs abroad, the reality is that competition between importers forces them to pass on savings.

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