The US dollar hit a new all-time low against the euro yesterday, with the euro trading at $1.41. Also against other European currencies the dollar is very low (1 UK pound is now worth $2.03). USD is expected to drop further because of interest rate decreases in US.
This means increased retail prices in Europe in the eyes of American consumers/producers and the gap between US and European pricing is bigger than ever.
Examples:
Eurozone (France, Italy, Germany etc.)
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Wii: $351,09 (€249)
Xbox 360 Elite: $634.50 (€449.99)
60 GB PS3 Starter Pack: $845.99 (€599.99)
Full price game: $84.59 (€59.99)
UK
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Wii: $363.37 (£179)
Xbox 360 Elite: $608.98 (£299.99)
60 GB PS3 Starter Pack: $862.75 (£425)
Full price game: $101.48 (£49.99)
Living in Norway with a very strong currency at the moment we really see this gap:
Norway (1 USD = 5,51 NOK)
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Wii: $479,69 (N2599)
Xbox 360 Elite: $725.77 (N3999)
60 GB PS3 Starter Pack: $1088.75 (N5999)
Full price game: $108.71 (N599)
Sure, this is with taxes (always included in European retail prices), but still the difference is staggering.
For an American company such as Microsoft this is great. They will now get a lot more dollars for a game/console from European/Japanese consumers than before. The record high exchange rate at the time Halo 3 being sold to stores is perfect for them. This makes it easier to cut prices in Europe and still make a profit.
On the other hand, Japanese companies such as Sony and Nintendo the low dollar is bad. They will now get less yen than expected for a console/game from US consumers. This makes it harder to cut prices in US.
