Brexit impacts likely to be felt near U.S. - Canada border

The effects of Britain's decision to leave the EU are likely to be felt in Washington in communities bordering Canada.

The effects of Britain's decision to leave the European Union are likely to be felt in Washington, where communities near the border worry a weakened Canadian dollar won't be rebounding anytime soon.

When the Canadian dollar is strong, about a quarter of the used car business at Bellingham's Roger Jobs Motors comes from customers north of the border.

“At this point, there's almost no cars, no used cars, going up to Canada from our operation, and we don't expect that to change until the Canadian dollar does come back up,” said manager Byron Sprague.

The Canadian dollar, or Loonie, doesn't go very far in the U.S. these days, so there hasn't been much incentive for Canadians to spend their money here.

Economists say markets will likely shift, and investors will want to sell foreign currencies, including the Canadian dollar, after Great Britain's decision to exit the EU. That'll likely keep the Loonie weak.

Bellingham's Aqui Esta Tile has seen fluctuations over the past few decades. At times up to 20 percent of their traffic has been from Canadian consumers.

“In the last year we've seen that dwindle virtually to nothing,” said owner Larry O’Connell.

The impact is less significant at Woods Coffee, where it's easier to justify spending a few bucks on a latte.

“We get the people that maybe (are) not spending the high dollars, want to spend a little bit less,” said president Wes Herman.

In fact, they're getting ready to open their first store in Canada.

“That's a booming economy in Vancouver and surrounding areas and some of the highest priced real estate in the world, and so we're excited about doing business in Canada,” Herman said.

Back on the U.S. side of the border, businesses are waiting to see the full impact of the Brexit on Canadian spending, but they aren't optimistic.

“We don't expect to see any great influx of Canadian business to return to some of the past levels it’s had,” said Sprague.

One thing that could strengthen the Canadian dollar is the price of oil. But that too is taking a hit in the few days post-Brexit.

 

Copyright 2016 KING


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