Yesterday, the Canadian dollar danced around at parity and today we can freely exchange a loonie for a greenback on equal terms. But what’s not clearly highlighted is that parity may be more of a psychological milestone than a material one.

So what are the implications for Canadians as a whole?

Cross-border shopping

Despite its attractiveness, it’s important to remember that parity is not a significant increase in the value of the loonie from the 95-cents-U.S. rate that it was hovering around for the last 6 months. This change in exchange rates won’t discernibly change your total shopping bill from what it’s been over the past 6 months. Rather, what will matter now is which side of the border you happen to find yourself A.P. (After Parity).

While you may not have noticed, the Canadian dollar has been steadily rising for past 2 years, increasing the gap between retail prices in the U.S. and Canada. Parity will only embellish this ongoing trend. The Retail Council of Canada announced this morning that retailers in Canada would be forced to match prices with the U.S., but this may not happen for months, meaning that cross-border shopping will be a great way to take advantage of a stronger dollar and its increased buying power. However, you need to be wary of the hidden fees and charges that can quickly make a great deal in the U.S. turn sour – Wishabi can help you bake in all those hidden taxes, duties and shipping fees smoothly into the final price so that you don’t receive any surprises.

Investment

If you’re planning to buy vacation property down in Florida or buy shares in American companies, a stronger dollar makes now a great time to invest. If the stab at parity this year didn’t make that much of a difference to your everyday weekend shopping, you will notice a difference with property and other capital good investments. The dollar parity gives you access to more choice at relatively lower prices than, say, a year ago.

Interest rates

With a strong dollar meaning that Canadians can now get more for every dollar they spend, inflation (a general increase in the price of goods and services in a country) will be kept stable, meaning that the Bank of Canada will not be quick to up its interest rates (the key lending rate for you business junkies out there). This means that you can now take out bank loans for big investments at lower interest rates than you’d normally expect.

Travel

As it happens, a strong Canadian dollar will be great for people looking to travel abroad for the Easter break, or perhaps that early summer break that we’d all welcome around this time of the year. A stronger Canadian dollar can be stretched more, so you get more “bang for your buck” whenever you make purchase using Canadian dollars. So regardless of whether you’re buying money (on the foreign exchange) or other products, this means you can buy more souvenirs in Italy, buy better wines in France and hit London’s nightlife for relatively less than it would have cost you a few months ago.

Importers

Good news for these guys. Again, like tourists buying souvenirs in Rome to take back home, importers can afford to buy greater quantities more cheaply, and sell them for relatively less in though here and now. Retailers that depend heavily on foreign imports to stock their shelves might even find themselves tempted to rollback prices on certain products in Canada – but don’t take our word for it.

Exporters

As luck will have it (or lack thereof), Canadian exports backed by a stronger dollar will become more expensive outside of Canada, having cost relatively more to produce (because the dollar is now worth more in other currencies) than comparable products made outside of Canada. Now less competitive than before, expect exporters to try and shift away from older markets towards newer less competitive markets, or to markets where the barriers to entry are not as prohibitively expensive.