The Singapore dollar (also known as Singdollar) is the official currency of Singapore. It is divided into 100 cents and is normally abbreviated with the dollar sign $, or S$ to distinguish it from other dollar-denominated currencies like the AUD, HKD or CAD.
All banknotes feature a portrait of former Prime Minister Lee Kuan Yew and all coins feature different birds found on the island nation.
The Singapore Dollar is also used in Brunei alongside the Brunei Dollar. The pair can be exchanged at parity and are considered legal tender within both countries.
The Monetary Authority of Singapore (MAS) is responsible for the currency, and they manage currency policy by pegging the Singapore dollar to a basket of currencies known as a trade-weighted exchange rate index (TWI). The TWI is made up of the currencies of Singapore’s main trading partners. The currency is allowed to float within a tight range around the TWI midpoint. If the currency weakens or strengthens beyond this band, the Monetary Authority of Singapore will intervene in the foreign exchange market to buy or sell Singapore Dollars.
The currency was originally pegged to the Pound Sterling at a rate but when the pound was devalued in 1967, the Monetary Authority of Singapore decided to keep the currency pegged to the U.S. dollar instead. This was because the U.S. currency was seen as a more stable currency and was also the currency of Singapore’s major trading partners.
The currency is also popular with currency traders as it is seen as a ‘safe haven’ currency and is often used to buy other Asian currencies when they are experiencing turbulence.
It seems remarkable now to think that the opening up of Asia to Western businesses is a relatively new phenomenon. Until recently many Asian countries