The Canadian dollar hit an 11-year low against the U.S. dollar Tuesday, which is good for Minnesotans looking for a Canadian getaway, but bad for Minnesota's American Indian tribes who benefit from visits from our northern neighbors.
The loonie closed at 75.87 cents to the U.S. dollar – the lowest its been since August 2004, CBC reports, due in part to weak oil prices and the likelihood the Bank of Canada will cut interest rates.
This is a good thing for Minnesotans willing to trek over the border to shop – the U.S. dollar is worth roughly $1.31 in Canada.
American travelers are visiting their northern neighbors, spending more money in the country because the dollar is worth more, which has contributed to a boom in the Canadian tourism industry, CBC reports.
The country's businesses have seen an influx of Minnesotans in the past two weeks, with the Star Tribune reporting a car dealership in Fort Frances, Ontraio, sold three vehicles to Minnesotans in a week, citing the exchange rate as a major factor.
But it could hurt Minnesota businesses
But because of the strong American dollar, more Canadians are deciding to stay home and travel within the country instead of coming to Minnesota (and other border states) – and that could start impacting business around the state.
Every year, about 700,000 Canadians – many from the province of Manitoba – come to Minnesota for an overnight trip, Explore Minnesota statistics show, with many visiting to shop in the United States, taking in a sporting event or visiting American Indian-run casinos, reports note.
"Canadian visitors are extremely important to Minnesota," John Edman, director of Explore Minnesota, told the Star Tribune.
But Canadians may think twice before crossing the border now that their loonies aren't worth as much, reports note.
“There’s always been this idea, at least, that there was more diverse retail offerings in the [U.S.]. A strong U.S. dollar will discourage some shoppers from crossing, although there is still an attraction," University of Manitoba economist Fletcher Baragar told Circle News.
Shop owners in International Falls have already noticed fewer Canadians stopping in, they told the Star Tribune. And Baragar told Circle News that Minnesota's tourism industry may soon start feeling the impact because fewer Canadians may cross the border for recreational purposes if the large exchange gap continues.
This could have an affect on the 18 American Indian-run casinos in the state, which often serve busloads of Canadian visitors, especially those near the Canadian border.
Grand Portage Lodge and Casino – less than an hour south of Thunder Bay, Ontario – may be the most affected if the flow of tourists over the border lessens. About 80 percent of the lodge and casino's patrons are from Canada, the Indian Affairs Council notes.
“It’s hard to imagine there is another Minnesota enterprise as dependent on international trade as them,” Minnesota Trade Office director P. Richard Bohr told Circle News.