Shoppers dashing to Johor or Jakarta for some bargains will be cheering the free-falling ringgit and rupiah, but the weaker neighbouring currencies can have unpleasant knock-on effects for the economy here.
Not only does it mean fewer tourists from Malaysia and Indonesia coming here and spending big, but falling currencies usually also point to wider economic problems that can spell trouble for Singapore firms trading or investing in those places.
Tourism arrivals clearly highlight the risks. Inbound tourism continues to slide from the all-time high in 2013, with international visitor arrivals declining 3.4 per cent in the first six months of the year over the same period a year ago, according to official data on Tuesday.
"The greatest misconception is that the slowdown in Singapore's tourism sector is due to China's slowdown," said OCBC Bank economist Selena Ling. "But look at the numbers from the region - it's not just a China story but a regional story as well."
Arrivals from Indonesia - Singapore's single largest market for inbound tourists - were down 13.7 per cent in the first half of the year.
"The decline was due primarily to the depreciation of the rupiah to its lowest in the past 12 months, coupled with a poorer economic outlook that discouraged international travel," said Singapore Tourism Board research director Shameem Mustaffa.
NOTHING TO CHEER ABOUT
Singaporeans see this as a good thing, they go shopping. But in reality, when your neighbour's economy is in such a state, and your neighbour is your second-largest trading partner - investment goes both ways - it doesn't benefit us.
FOREIGN MINISTER K. SHANMUGAM
And while arrivals from China - the second-largest source market - grew 8.9 per cent in the first half of the year, visits by Malaysian tourists - the third-largest group - declined 5.2 per cent.
The ringgit has plunged 20 per cent against the Singdollar over the year while the rupiah is down about 7 per cent.
Both currencies have hit new all-time lows against the Singdollar over the past few months as currency markets descend into turmoil on the back of policy moves in China and investors bracing themselves for the United States to raise rates.
The Singdollar has depreciated against the greenback but less so than the ringgit and rupiah, which are defended by central banks in weaker financial positions.
One Singdollar could fetch RM3.0225 or 9,983.26 rupiah as of 8pm last night.
The dramatic falls have not been missed by developers and asset managers, who have cranked up their advertising, citing the low ringgit as a chance to get Malaysian properties at a bargain.
Even Foreign Minister K. Shanmugam felt the need to weigh in.
"If I were to say the (Malaysian) economy wasn't doing too well, it would not be an understatement," he said in a speech to media professionals at Singapore Press Holdings yesterday.
"Singaporeans see this as a good thing, they go shopping. But in reality, when your neighbour's economy is in such a state, and your neighbour is your second-largest trading partner - investment goes both ways - it doesn't benefit us."
Analysts say the ringgit's fall is tied closely to waning confidence in the Malaysian economy, which has spillover effects in Singapore.
"If you think of the currency as a vote of confidence, we've seen consumer confidence fall to the lowest level since the global financial crisis, and this feeds into investment and consumption decisions," said ANZ senior foreign exchange strategist Khoon Goh.
Other apparent boons from a stronger Singdollar - such as cheaper imported food - may not reach households in the way people imagine, warned ANZ economist Weiwen Ng.
"Food inflation is a tricky issue. We source food from countries in the region, Malaysia and Indonesia among them, so imported food inflation should be more benign," he noted.
"The question is, are businesses willing to transfer these cost savings to consumers? The prices at petrol pumps have been sticky, despite oil prices tanking."
Besides, the way trade works, no one can be an all-round winner. A stronger Singdollar means cheaper imports, but exports get less competitive as well.