Flaherty to pressure retailers into lowering prices
Plans to meet with Retail Council of Canada
Last Updated: Saturday, October 20, 2007 | 9:06 AM ET
CBC News
Finance Minister Jim Flaherty says he will meet with retailers next week to discuss how prices can be dropped on a bevy of goods to reflect gains made by the Canadian dollar against the U.S. currency.
A stronger loonie means retailers are paying less for goods made in the United States, so those savings should be passed on to consumers, Flaherty told reporters Friday in Washington, D.C., where he was attending an international finance meeting.Finance Minister Jim Flaherty speaks during question period in the House of Commons on Wednesday.
(Tom Hanson/Canadian Press)
"Prices should go down over all. Now, it won't all happen overnight. It'll happen over time, and different sectors of the retail economy have different realities in terms of pricing," Flaherty said before heading into a meeting of finance ministers and central bankers.
Flaherty is to meet with the Retail Council of Canada and several large retailers on Tuesday in Ottawa.
Companies expected to be represented at the meeting include Toys "R" Us Inc., Forzani Group Ltd., Staples Inc., Wal-Mart Canada Corp. and Hudson's Bay Co., an aide to Flaherty said.
"We want to move toward lower prices reflecting the change in the value of the currency,'' Flaherty said.
He said his government has been asking for some time now how Canadian prices can be brought more in line with those in the U.S. given the current status of the Canadian dollar.
The loonie hit a new 31-year high Friday, climbing as high as $1.0358 US. The Canadian currency has risen 20 per cent against the U.S. dollar this year.
Prices lowered at Zellers, Wal-Mart
Faced with calls to pass on the savings from a high Canadian dollar to consumers, some of the country's biggest retailers are responding with price cuts.
Hudson's Bay Co. announced Friday that it's using savings achieved through the greater buying power of the loonie to cut prices on nearly 300 items at its Zellers stores.
Earlier this week, Wal-Mart Canada announced it will cut prices on what it called its "higher profile" items, such as video games, DVDs, music, and toys.
