Australians should look overseas when buying new tech gadgets and other items instead of waiting for local retailers to react to the soaring Australian dollar, CommSec chief economist Craig James says.
Australia's currency has rocketed from 63 US cents in March this year to about 91.5 US cents today, James said, but local retailers and importers have not necessarily dropped their prices.
CommSec's latest iPod index, released today, shows Australia has slipped eight places since June and is now the 13th cheapest place to buy an Apple iPod Nano 8GB music player, in US dollar terms. It found Australians could save as much as $20 by buying their iPods on websites in the US or Hong Kong or while on holidays in those countries.
Over the past year, in Australian dollar terms, the cost of an 8GB Nano has not changed, CommSec found, but in US dollar terms the price jumped by 38 per cent from $US132 to $US182. "In other words Apple is basically obtaining higher revenues courtesy of a weaker US dollar," CommSec found.
But James said it was not just iPods that were now more expensive. Prices for many products, particular tech goods such as TV sets, increased by up to 30 per cent earlier this year as the global economic crisis kicked in and the exchange rate tanked. "The strength of the exchange rate does mean now that you are perhaps getting a better deal by buying [goods] directly from US stores and paying the freight component," James said.
"If you wait around for the Australian retailers to change you may be waiting for some time and if you're after a particular good now and you're getting a good deal from a reputable site overseas then that may be the way to go."
James conceded that there was often a lag between movements in the currency and the price of goods, as retailers and importers usually renegotiate their contracts every few months. He also noted that, with products such as iPods, although prices were unchanged, technology advancements meant consumers were getting more value for their money at the same price point.
He used higher storage space on the new iPods as an example. "There's been some big [exchange rate] changes in a short period of time and that shows the difficulty of retailers keeping up with this and making sure their pricing is appropriate and competitive," James said. Apple spokeswoman Fiona Martin said the higher Australian prices were due to "freight, currency exchange fluctuations, Australian GST, Australian standards compliance and other local costs".