Euro exchange rate is no holiday for American shoppers in Germany
November 30, 2007
When it comes to Christmas cheer, the dollar exchange rate is a downright Grinch.
Just ask workers at on-base Käthe Wohlfahrt stores, where tree ornaments, nutcracker figurines and other holiday paraphernalia are peddled year-round.
The store’s prices have changed little, if at all, since last holiday season, said Lisa McCarty, manager of the store in Vogelweh, Germany. But those prices are in euros.
When converted into dollars at the register, it’s evident that the exchange rate has driven up the cost of tree-trimming and hall-decking for Americans who shop at the stores.
An average-size wooden Käthe Wohlfahrt Santa priced at 55.50 euros, for instance, would have gone for $72.60 the day after Thanksgiving in 2006. This year, that same Santa, still priced at 55.50 euros, went for the equivalent of $82.28 on Friday, according to Federal Reserve Bank of New York exchange rates.
When customers see converted prices like that pop up on the register, “they do have a little bit of shock,” McCarty said. “They’re just seeing the difference between last year and this year.”
“Once people see the rate, they tend to put things back,” said Mandy Deines, a salesperson at the store in Stuttgart, Germany.
Though McCarty hasn’t yet compared this year’s holiday sales to last year’s, she said they are “definitely slower” now because of the weakened dollar. Overall, there are just about as many customers coming through the doors as last year, but when it comes to buying, they’re “just picking a little more wisely,” she said.
For some, though, the exchange rate isn’t reason enough to spoil holiday spending.
Linda O’Brien, a budget analyst for the 7th Signal Brigade in Mannheim, Germany, and a regular Käthe Wohlfahrt shopper, is a little more conservative with her purchases now, she said. Before dropping 300 or 400 euros on big-ticket items, she shops around.
But when it comes to the wooden crafts sold at Käthe Wohlfahrt, “I generally buy what I want,” she said while shopping Saturday at the Heidelberg, Germany, store.
O’Brien, like others, lamented the high cost of the euro. However, “we get a post allowance, so on one side I can’t complain,” she said, referring to the cost-of-living allowance some overseas Americans get to offset the high cost of living in Germany.
Chris Everson, a salesperson at Käthe Wohlfahrt, discusses Christmas decorations with Linda O’Brien, a budget analyst for 7th Signal Brigade and regular Käthe Wohlfahrt shopper.