(The Center Square) — The US dollar is approaching a 5-year high compared to the Canadian dollar, an exchange rate at its strongest point since the beginning of the pandemic, according to the currency exchange site XE.com. This shift is expected to worsen a down year of traffic into Washington state from Canada and hurt retail prospects in border counties.
Experts are quick to point out the exchange rate is not the only issue depressing traffic and commerce.
“While there is a clear relationship between passenger travel and the exchange rate, it is a bit more complex in the trade environment,” said Dr. Laurie Trautman of Western Washington University’s Border Policy Research Institute to The Center Square via email.
The last time the US dollar had a run up of this magnitude in 2016 cross border vehicle traffic dropped by a significant 32%, or 2.2 million vehicles from the peak 3 years prior, according to US Department of Transportation data on border entries.
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Click for more informationPresent day data looks comparatively worse for economic tourism even than it did at the end of the previous long slump.
The last year of pre COVID-19 data we have is for the year 2019. Cross border vehicle traffic clocked in at 6.8 million vehicles in that year. Current year-to-date the data for 2022 shows only 2.3 million personal vehicles crossing the border, a nearly 200% drop from 2019, or a gap of 4.5 million vehicle crossings.
Fewer than 2 months remain for passengers of vehicles with Canadian license plates to come close some of that gap.