With dollar low, US is one big outlet

Europeans arriving in droves for bargains

By Jenn Abelson Globe Staff / November 24, 2007

WRENTHAM - Hours after her flight from Dublin landed in Boston on Thanksgiving, Alice Kinsella headed in a white van with a dozen relatives and friends to Wrentham Village Premium Outlets. The 36-year-old has never visited Boston, but she is bypassing the sights for an extended weekend of binge shopping that started at midnight yesterday.

For Kinsella and other Europeans, America is one big discount bin, thanks to a weak dollar that slid this week to another record low against the euro. As a result, tourists are spending thousands to travel to the United States to snag blockbuster bargains on everything from iPods to designer clothes and handbags.

By 4 a.m. yesterday, Kinsella had rung up nearly $2,000 in Christmas presents and winter clothes, including a $79 black leather jacket at Guess that she estimated would cost more than $250 in Ireland.

"The bargains for us are so great," said Kinsella, who paid $1,000 for a flight and hotel but expects to save even more on purchases here.

Kinsella is one of a record 1,000 international tourists who scheduled organized shopping trips yesterday to Wrentham Village Premium Outlets - more than double the number last year. Hundreds more were expected to come on their own, according to Beth Winbourne, the outlet's general manager.

Foreign travelers have long visited the United States to get their holiday shopping fix. After all, many design er brands like Tommy Hilfiger, Ralph Lauren, and Guess are cheaper here because sales taxes are lower and because the bigger market here allows goods to be priced more competitively.

But now American wares are even more of a bargain as the slowing US economy has weakened the dollar. Further, as the Federal Reserve has cut interest rates to boost the economy, the dollar has lost even more value, and global investors have realized they won't earn as much when they park their cash in greenbacks. As a result, the euro has shot up by 33 percent compared with the dollar since 2002, so Europeans who exchange 1,000 euros now get close to 1,500 US dollars. And the Canadian dollar is worth as much as the US dollar for the first time in three decades.

While some US shoppers are tightening their purse strings this holiday season amid rising gasoline prices, the slumping housing market, and the current credit crunch, the one silver lining for some merchants is the tidal wave of foreign dollars pouring into US stores.

"With Americans looking to cut back and conserve because of economic uncertainties, the holy grail this holiday-season year for retailers are the international travelers who are coming here in record numbers," said Patrick Moscaritolo, president of the Greater Boston Convention & Visitors Bureau.