Do not be confused by foreign exchange rates!

The next time you head on to a money exchanger, if you are buying a foreign currency you will be looking at the SELL rate as this is the rate which the money exchanger is selling you at. Vice-versa if you are selling a foreign currency, you will be looking at the BUY rate. You will also find that the SELL rate is higher than BUY rate. This is the spread, whereby the money exchangers make their profit from a no-commissions, no sales fee sales.

Money exchangers sometimes use figures that are sometimes confusing for you and me. Especially so when you are comparing money exchanger rates from one vendor to another and you only have one question in mind: Should a lower or higher SELL rate be lower for me?

I have personally made the mistake where I gleefully changed currencies at lower rates when actually the higher rates are better for me! I made a loss instead of what I thought was a better deal.

I share some common currencies to break the confusion. Generally, the lower the SELL rate, the better it should be for you.

Table 1: Cases where lower the rates, the better

Currency (to buy 1 unit of)	Sell rate (pay x units of SGD)	Remarks
USD	1.367	lower the better
AUD	0.963	lower the better
GBP	1.7075	lower the better
CAD	1.048	lower the better
EUR	1.5295	lower the better
CHF	1.39	lower the better
NZD	0.925	lower the better
JPY	0.01268	lower the better
LKR	0.0083333	lower the better

For the above, what it essentially means is that to buy 1 unit of foreign currency, you need to pay x units of SGD to the money exchanger. Therefore, the lower the rate, the more bang for buck you are getting. For example, to buy 1 USD I am paying S$1.367. If another vendor offers me the rate of $1.356, this lower rate is better as I am saving 1.1 Singapore cents per USD exchanged.

Table 2: Cases where higher the rates, the better

Currency (pay 1 unit of SGD)	Sell rate (get x units of foreign currency)	Remarks
RMB	5.06	higher the better
HKD	5.72	higher the better
MYR	3.01	higher the better
THB	22.4	higher the better
TWD	22.8	higher the better
KWR	870	higher the better
PHP	35.8	higher the better
IDR	10220.00	higher the better
INR	50.50	higher the better
SAR	2.73	higher the better
AED	2.66	higher the better
VND	16800	higher the better
MMK	980	higher the better

For the above, what it essentially means is that with 1 unit of SGD, you can buy x units of foreign currency from the money exchanger. Therefore, the higher the rate, the more bang for buck you are getting. For example, with S$1 I can buy 870 KWR . If another vendor offers me the rate of 885 KWR, the higher rate is better as I am getting 15 KWR more with each SGD exchanged.

However, not all money exchangers display the rates like they do in Table 2 all the time. They might also display the same foreign currency rates in Table 2 like in Table 3 below.

Table 3: Cases where lower the rates the better

Currency (to buy y units of)	Sell rate (pay x units of SGD)	Remarks
RMB (100)	19.37	lower the better
HKD (100)	17.51	lower the better
MYR	0.328	lower the better
THB (100)	4.508	lower the better
TWD (100)	4.48	lower the better
KWR (1000)	1.1603	lower the better
PHP (100)	2.661	lower the better
IDR (100,000)	9.719	lower the better
INR (1000)	19.33	lower the better
SAR	0.366	lower the better
AED	0.374	lower the better
VND (100,000)	5.92	lower the better
MMK (1000)	0.898	lower the better

For the above, it is similar to Table 1. What it essentially means is that to buy y units of foreign currency, you need to pay x units of SGD to the money exchanger. Therefore, the lower the rate, the more bang for buck you are getting. For example, to buy 1000 KWR I am paying S$1.1603. If another vendor offers me the rate of $1.1501, this lower rate is better as I am saving 1.02 Singapore cents per 1000 KWR exchanged.

If you do consider selling back your foreign currencies for SGD, the reverse logic is also true when you refer back now to the BUY rate.

Phew! Will this make your life easier the next time you change foreign currencies?