The Canadian Dollar's Effect On The iPhone

Barclays on Monday issued an update on the telecommunications industry, commenting on the Canadian dollar's effect on Apple Inc. AAPL and the iPhone. Heading into the holiday shopping season, promotional activity has increased to attract customers amid the weakening Canadian dollar.

Analyst Phillip Huang wrote, "While the levels of promotional activity into Black Friday has certainly picked up relative to the prior year we note that overall prices are largely unchanged versus last year due to the significantly weakened Canadian dollar."

Discounts have not been limited to the actual iPhone hardware, but have been seen in data plans. Barclays believes the discounts will support wireless margins in the fourth quarter.

Related Link: This Report Says iPhone Supply Chain Orders Have Weakened, And It's Sending Apple Shares Lower

Important to Barclays is the double cohort effect, which should be lessened due to increased headset costs relative to the prior year, caused primarily by the weakened Canadian dollar. Barclays also sees the importance of data plans as they are high margin items and estimates point that 30 percent of industry subscribers are off contract.

Shares of Apple last closed at $117.81 and recently traded at $119, up about 1 percent on Monday morning.