Currency movement towards new normal

In recent months, currencies were adjusting to a new normal. I have interest in three currencies, namely US dollar (USD), Chinese Yuan (CNY) and Australian dollar (AUD).

The table shows the currency rates of these currencies vis-à-vis Singapore dollar (SGD) on three dates (1.1.2014, 13.11.2014 and 13.3.2015). CNY/SGD figure shows how much one unit of CNY is worth in SGD, and so as the other currency pairs.

Currency cross rates
Date CNY/SGD Change AUD/SGD Change USD/SGD Change
1 Jan 2014 0.2089 1.1125 1.2620
13 Nov 2014 0.2116 1.29% 1.1140 0.13% 1.2910 2.30%
13 Mar 2015 0.2220 4.91% 1.0630 -4.58% 1.3920 7.82%

Between 1 January 2014 and 13 November 2014, CNY strengthened by 1.29% against Singapore dollar. Between 13 November 2014 and 13 March 2015, it strengthened even more by 4.91%

As for Australian dollar, it weakened against Singapore dollar, by 4.58% during the last four months.

The US dollar was really strong against most global currencies. It shot up 7.82% durng the last four months against Singapore dollar.

For investments denominated in CNY and USD, investors gained on currency movements. But, investors in AUD investments suffered due to the weakness of the Australian dollar.

Copyright © 2015, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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2 Responses to Currency movement towards new normal

  1. ak says:

    Hi Mr Lim,

    I am curious to know why you choose to invest on usd, rmb and aud? And your views on sgd to these 3 currencies in the near future will be helpful.

    I have usd too. My view is usd will have more room to appreciate due to its improving economy and it is still after all, the international currency of the world. Back to $1.50 level perhaps then I will be tempted to cash out.

    Rmb is at a new low (disclaimer applies) against Sing. I feel that China cannot afford to allow rmb to appreciate any more or it is risking it’s export oriented economy. So little reward to buy more rmb.

    I am actually looking at buying some aud and euros. Appreciate your thoughts. Thank you.

    • limkimtong says:

      Hi ak,

      Currency investments are high risks and I am in no position to advise which way the currency will be in the future. I lose on AUD but gain on Chinese Yuan currently. This may reverse course in the future, I do not know. I still believe in AUD and Chinese Yuan for the longer term and still held on to the investments. As for USD, the family had a business that also transacts in USD. Therefore, I am interested in how USD moves. As for Euro, I am not too sure of the currency at this moment.

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