SINGAPORE: On Tuesday (March 10), the Singapore dollar traded at RM3.08 or RM3.09. The progress Malaysia’s currency has made has been remarkable. As recently as two years ago, it was one of the worst-performing currencies in the region, when the ringgit traded at RM3.5725 to S$1.
In April 2024, it reached a 26-year low.
When the ringgit performs poorly, this means good news for Singaporeans, as it allows the Singdollar to be stretched more on trips to Johor Bahru or Kuala Lumpur for shopping, dining, or vacation trips.
Therefore, with the ringgit performing well, the expectation was that fewer Singaporeans would cross borders as they could afford less. This does not seem to be happening, however, arguably due to the strength of the Singdollar itself, which is one of the most stable currencies around the world. Also, Singaporeans have gotten smarter about getting their money’s worth.
Last year, Kelvin Lam, the chief operating officer of YouTrip, the digital wallet for travelers in Singapore, Thailand, and Australia, was quoted in a Business Times article that many Singaporeans keep a close eye on the ringgit and take advantage of the periods when the currency weakens. Moreover, he said that Singaporeans behave like “savvy FX hunters” who actively convert when rates move.
“The data shows that the stronger ringgit hasn’t stopped Singaporeans from heading across the Causeway; it has simply made them strategic.
While the MYR is stronger, Singaporeans are still drawn to Malaysia,” he was quoted as saying in a March 9 CNA piece.
As proof, the Singaporeans whom CNA spoke to acknowledged that they are spending more—though not too much more—on trips to Malaysia; this has hardly bothered them, and they do not appear to plan on changing anything soon.
Some local Reddit users commenting on the CNA piece appeared to agree.
“Growing up in the 90s, the exchange rate was SGD1: RM1.60. Singaporeans still flocked to JB for shopping, and Malaysians still flocked to Singapore for work. As long as things are significantly cheaper in JB, Singaporeans will still shop there, plain and simple. No one is going to stop shopping just because the discount is now 30% instead of 40%,” wrote one.
“As long as there’s a sufficient price gap for me to lug the item back to SG, don’t see why not. Some items in Malaysia are way cheaper than in SG, and the amount (or at least item level) won’t make a significant difference with changes in exchange rate,” agreed another.
Others, however, no longer believe that it’s worth it, saying that prices in Johor Bahru, at least, are similar to Singapore prices.
“Even at a 1:3 rate, JB prices aren’t what they used to be. I went once and spent more than S$250. Tbh, I’m not sure how much savings I had or if it’s just reckless spending. I already stopped going because it’s just not worth my time and efforts,” a Redditor wrote.
“I no longer go to JB anymore cos prices are the same as Singapore now,” another added.
“Huh, last time I went (last week), the Kopi was the same price as some places in SG. It’s just not cheap anymore, let alone ‘significantly’ cheap,” a third chimed in. /TISG
Read also: Ringgit reaches 7-year high: Singdollar won’t stretch as far as it used to in JB
