Rolex Price DECREASE!!!

[petee1997]

Rolex sets all their prices in Swiss Francs. If a given currency increases against the SF the price is adjusted accordingly. The SF has had huge gains against most currencies over the last few years forcing big price increases in most countries.
Now with the economy getting better in natural resource exporting countries like the middle east, Australia, Canada those currencies are getting stronger and prices are going down. A good example is the price of German cars have seen big declines in Canada.
It's all about economics 101 and nothing to do with deflation. Reading some of the coments here makes me wonder if some people live in a bubble. By the way the reason we don't see prices change monthly is that most large exporting companies hedge their currencies to stabalize prices.

[Scott95]

Originally Posted by petee1997

Rolex sets all their prices in Swiss Francs. If a given currency increases against the SF the price is adjusted accordingly. The SF has had huge gains against most currencies over the last few years forcing big price increases in most countries.
Now with the economy getting better in natural resource exporting countries like the middle east, Australia, Canada those currencies are getting stronger and prices are going down. A good example is the price of German cars have seen big declines in Canada.
It's all about economics 101 and nothing to do with deflation. Reading some of the coments here makes me wonder if some people live in a bubble. By the way the reason we don't see prices change monthly is that most large exporting companies hedge their currencies to stabalize prices.

I don't think you've got this right for two reasons.

1. Cost does not determine price - supply and demand does, that's the real Economics 101.

2. If we look at the USD/CHF exchange rate over the last 5 (or even 10) years - the Dollar has gotten stronger and stronger over the entire period with a few fluxuations that could have been covered with a hedge. (A Swiss Franc now costs approx. $0.90 today, it was approx $1.25 5 yrs ago and $1.35 10 yrs ago) In other words, it takes less dollars to buy one Swiss Franc. Using your logic, the price of a Rolex in Dollar markets should have steadily dropped over the last 10 yrs which it clearly hasn't. http://www.google.com/finance?q=USDCHF&hl=en

The only reason I can think of for Rolex to locally adjust price is that the local market's demand has found another (cheaper) supply. So if Rolex wants to keep the local market's AD's viable, they have to match the other supply's price.

[Hooper]

Rolex price decrease I looking to the sky for flying pigs