Eyes on prices as dollar rises

As the dollar flirts with parity, those who hold the power in IT purchasing will be wondering what the dollar's stellar rise will win them in terms of discounts.

"Obviously the exchange rate is a factor. As the currency fluctuates, it relieves pressure on the pricing companies have set," Ideas International senior vice president research and operations Gary Burgess told ZDNet Australia.

Once vendors are feeling price relief, they may pass it onto their customers, he said, although he joked that it could be like the banks which increase rates when there's a rate rise, but don't always pass on cuts when the rates are falling.

Regardless, changes are unlikely to happen immediately, according to Burgess.

"Last time this happened there was a bit of a lag," he said. "It doesn't happen straightaway."

Part of the reason for vendors waiting is that they don't know where the exchange rate would go in the coming weeks, he said.

"A lot of people are saying the dollar is overvalued," he said. "The $64,000 question is how long is [the dollar] going to stay up?"

Burgess said that if he were a vendor, he'd wait to change prices until levelled out.

"They don't want to be changing prices every week," he said.

He said that if the dollar does stay high, however, companies would eventually have to drop prices since it would be hard to justify keeping them up.

His gut feeling was that Australians would start seeing the price changes just before Christmas or in January.

Consumer purchasing

eBay spokesperson Jenny Thomas said that the dollar had been strong over the last 18 months, but there had been a peak in April, which saw a 60 per cent increase in buyers shopping with eBay sellers. She expected that the current peak against the greenback would see a similar increase.

Six million buyers come to the Australian eBay site a month.