Singaporeans flock to money changers after pound dives on Brexit news

People queueing at Arcade Money Changers at The Arcade at Raffles Place on June 27 2016.
People queueing at Arcade Money Changers at The Arcade at Raffles Place on June 27 2016.ST PHOTO: LIM YAOHUI
A customer exchanging Singapore dollars for British pounds, at Sheen International Exchange on June 27, 2016.
A customer exchanging Singapore dollars for British pounds, at Sheen International Exchange on June 27, 2016.ST PHOTO: LIM YAOHUI

SINGAPORE - As news of Britain's decision to exit the European Union (EU) trickled in during lunchtime on Friday (June 24), curious Singaporeans flocked to money changer hub The Arcade to compare exchange rates for the weakened sterling.

While the British pound at one point dived to 1.80 against the Singapore dollar on Friday, the rates at the counters in Raffles Place reflected that of Thursday's (June 23) - between 1.915 and 1.99.

Still, queues formed at counters offering cheaper pounds, and at least one money changer ran out of the sterling by 2pm.

Among those in line were Singaporeans with plans to travel to Britain for a holiday or who were funding their children's British education.

"I'm changing about $4,000 for a holiday to Southampton next month," said retired architect David Wee, 70, who was among dozens in a queue at Raffles Money Change, where the rate was 1.92.

"It might drop further, but I don't think it will save me much," he added.

British citizen Edward Pank, 45, who said he was "devastated" by Britain's decision, was in line to change $2,000 worth of euros and pounds before his flight to London on Friday night.

The weakened sterling was cold comfort to him. "There're all sorts of uncertainties for the EU and what the future holds for the United Kingdom. I'm worried that Scotland will break away, and it'll lead to the break up of the UK," said the managing director of an advertising research firm.

The pound has depreciated by more than 10 per cent against the Singapore dollar since August last year. The Singdollar hovered at around 1.85 to the pound on Friday (June 24), compared to 2.11 a year ago.

Other consumers are hoping for the sterling to plunge further.

A business consultant who gave her name as Samantha, 28, said regretfully that she changed $1,000 at a rate of 1.98 last week. She intends to buy $10,000 worth of pounds for a family holiday to London in December - but held off buying on Friday. "I'm sure it will drop further," she said.

The news also unsettled money changers, with several choosing to stop trading the sterling until next week. Others sold their old stock of pounds at Thursday's rates.

"Even though the interbank rates were low, the banks were selling to us at a high rate," said the president of the Money Changers Association, Mr Omar, who cleared his stock of pounds on Thursday at a rate of 1.94 and did not buy any on Friday.

"If I'd held on to 10,000 pounds, I would've lost $1,000 today (Friday)," added Mr Omar, 55, who goes by one name. "If I don't trade, I won't earn, but I also won't lose."

Meanwhile, Arcade Plaza Traders bought double its usual amount of pounds on Thursday, as it had anticipated a rush for the currency after the Brexit results. Its rate for the sterling hovered between 1.915 and 1.92 on Friday.

Elsewhere, consumers took advantage of the tumbling pound to shop on British sites such as online fashion retailer Asos, which reportedly crashed after heightened shopper traffic.