John Ecklund loves to see a strong Canadian dollar.

And Ecklund, the general manager of Walden Galleria in Cheektowaga, had plenty to smile

about Tuesday, when, for the first time since July 2008, the Canadian dollar was worth a

fraction of a penny more than the U.S. dollar.

"It's a good thing for us when the Canadian dollar is at par, or close to par," Ecklund

said.

The mall has long attracted Canadian shoppers with lower prices and different stores, but

the flow of customers from across the border still tends to rise and fall in tandem with the

buying power of the so-called "loonie."

"We have a strong Canadian shopper presence here, so it's hard to put a finger on it, but

we definitely have seen an uptick," Ecklund said.

The story is the same at Fashion Outlets of Niagara Falls in the Town of Niagara. "We're

getting an upsurge because of the dollar," said James A. Schlesinger, the chief executive

officer of AWE Talisman, the Florida-based company that owns the mall. "The uptick is not

dramatic. Sales are getting a bit stronger because they see there's more value here."

The loonie's strength is good news for businesses in the Buffalo Niagara region —

from stores to tourist stops — that can cash in on the increased purchasing power that

the soaring loonie gives Canadians.

"From the perspective of the Buffalo Niagara region, it's wonderful because it will bring

Canadian shoppers. It will bring tourists from the other side of the border," said Mikhail

Melnik, a Niagara University economist. "This summer, we will have Canadian shoppers to keep

us afloat."

But as both nations struggle to pull out of the deepest recession in three decades, their

still-weakened economies will temper the benefits for the Buffalo Niagara region.

"The strong dollar offers a discount to Canadians," Melnik said. "But the discount is only

good to those who have the cash."

The loonie's rally results from a strengthening Canadian economy, buoyed by the rise in the

price of commodities, such as oil and wheat, that provide a significant portion of the

country's exports.

The Canadian economy has added jobs for three straight months, compared with just a single

month of job growth in the United States. Rising commodity prices also are good for Canada,

which has the second-largest oil reserves outside the Middle East. Oil prices have shot up by

almost 71 percent over the last year and closed Tuesday at a 17-month high of $86.84 a barrel.

"On almost every relative measure, Canada is strong," said Camilla Sutton, a Scotia Capital

currency strategist.

Many economists, both in the United States and in Canada, are predicting that the surge in

the Canadian dollar, which has boosted its value by 29 percent over the last year, will have

staying power, unlike the 2007-08 spike that pushed the loonie to almost $1.09 but lasted less

than 11 months.

Loonie rising again

Canadian dollar's value in U.S.

Now: $0.99

March 9, 2009: $0.76

Nov. 6, 2007: $1.08

Feb. 12, 2003: $0.65

Jan. 18, 2002: $0.61

"If the recovery holds, everything is pointing in the direction of the Canadian currency

strengthening," Melnik said.

The strong Canadian dollar, likewise, will make visiting Canada more expensive for

Americans, potentially keeping some of those tourist dollars on the U.S. side of the border.

"The strong dollar will make life difficult for the [Canadian] tourism industry, both by

discouraging foreign visitors from coming to Canada — particularly U.S. tourists —

... and by encouraging Canadians to travel outside of the country with their high-powered

loonies," said Douglas Porter, an economist at BMO Capital Markets in Toronto.

In a sign of exactly that, same-day trips from the United States to Canada at local border

crossings last year were less than half their 2006 levels, according to Statistics Canada. In

contrast, same-day trips from Canada to the United States last year were down less than 10

percent from their 2006 level.

Melnik, who has studied the relationship between the value of the Canadian dollar and the

Buffalo Niagara economy, said every 1-cent rise in the loonie translates into an average

increase of 270 to 280 cars a day crossing the Peace Bridge.

More Canadian shoppers also should mean more sales tax revenues for local government. Every

1 percent drop in the value of the U.S. dollar adds about $12.8 million a month in sales to

Canadian shoppers. Those added sales also bring in about $610,000 a month in extra sales

taxes.

"Where the Canadian dollar's effect fails to have an impact is on employment growth," said

Melnik, who found that the influx of Canadian shoppers has not led to significant hiring by

retailers. Canadian shoppers, he said, merely are filling the void in the local retail sector

resulting from the steady decline in the Buffalo Niagara region's population.