BMO Capital Markets released a report which suggests that although the price gap between Canadian and US products has narrowed, Canadians are still paying 10 percent more. That is a 4 percent drop from the price gap in May of 2012. Doug Porter, a BMO chief economist, says the gap is still above where it should be, and as a result Canadians are flocking across the border to get better deals. Porter’s random survey found that baby items cost 34 percent more in Canada, running shoes are 19 percent higher, and hardware prices are 14 percent above American ones. The report also found that Ottawa’s policy of cutting import tariffs on some items had little effect on the price gap. There is an $18 billion deficit in tourism in Canada, partly due to Canadians crossing the border to shop.
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