What happens when one Singapore dollar can be exchanged for $2.7234 Ringgit? Singaporeans flock to money changers to indulge in one of its favourite national activity – queueing up! Yes, long queues were seen at many money changers yesterday when the ringgit fell to its lowest against the Singapore dollar in the last 30 over years. In fact, many money changers had signs put up to say that the Malaysian ringgit had already been sold out by afternoon.
The weakening Malaysian ringgit took a turn for the worse when the Monetary Authority of Singapore announced that it will continue to stand by its usual philosophy of a modest and gradual appreciation of the Singapore dollar. Since global oil prices has slid drastically in recent times, Malaysia, who is an exporter of oil has taken a hit.
The Singdollar gained after the Monetary Authority of Singapore announced on Tuesday that it would maintain its stance of a modest and gradual appreciation of the currency.
Meanwhile, Malaysia has had a spot of financial trouble lately. National revenue for the major oil exporter has been hit hard by the slump in oil prices, forcing the government to raise its deficit target for its 2015 Budget.
Other than investors who dabble in exchange investments, many Singaporeans are most interested in the Malaysian ringgit simply because of the proximity of Malaysia to Singapore. Many Singaporeans go into Malaysia often to do their shopping, buy groceries or just spend a weekend relaxing. Perhaps the new levy on cars entering Malaysia has also affected Singaporeans who go to Malaysia often and exchanging more ringgit at the opportune moment is even more important now. And then there is the new 6% GST affecting all shoppers be it Singaporeans or Malaysians in Malaysia.
Some Singaporeans may exchange more than they need for their trip to Malaysia to keep for the next trip.
Are you one of those in the money changer queues?