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About the Singapore Dollar (SGD)

What Is the Singapore Dollar (SGD)?

The Singapore Dollar (SGD) is the official currency of Singapore, a sovereign city-state and island country in Southeast Asia. It is represented by the symbol S$ to differentiate it from other dollar-denominated currencies. The currency is divided into 100 smaller units known as cents. The Singapore Dollar is the sole legal tender in Singapore, and it is used for all transactions within the country.

The Singapore Dollar (SGD) is issued by the Monetary Authority of Singapore (MAS), which serves as the central bank and the integrated financial regulator of Singapore. The MAS is responsible for the design, production, and issuance of Singapore's currency in the form of both banknotes and coins. Additionally, it oversees various aspects of monetary policy, financial regulation, and currency management in Singapore.

What Is the History of SGD?

Singapore's currency history is as diverse as its cultural fabric. Prior to the SGD, the region saw a variety of currencies, including the Spanish dollar, the Straits dollar, and the Malayan dollar. During the Japanese occupation in World War II, the "military yen" was used. Post-independence in 1965, Singapore continued using the Malaya and British Borneo dollar until the introduction of the SGD in 1967.

Notes and Coins of SGD

The Monetary Authority of Singapore (MAS) issues SGD coins and banknotes. Coins come in denominations of 1, 5, 10, 20, 50 cents, and 1 and 5 dollars. Banknotes are available in $2, $5, $10, $20, $25, $50, $100, $1,000, and $10,000 denominations. However, high-value notes like $1,000 and $10,000 are being phased out to mitigate money laundering risks.

Is SGD Pegged to GBP?

The Singapore Dollar (SGD) is not currently pegged to the British Pound (GBP). It operates on a managed floating exchange rate system, where its value is not fixed to any single currency but is instead managed by the Monetary Authority of Singapore (MAS) against a basket of currencies of its major trading partners and competitors. This basket includes major currencies like the US Dollar, Euro, Japanese Yen, and others.

Historically, however, the SGD was pegged to the British Pound. This arrangement dates back to Singapore's time as part of the British Empire when its currency was linked to the British Pound. Following Singapore's independence in 1965, there was a transition in its currency policy. Over time, Singapore moved away from the British Pound peg and eventually adopted the managed floating exchange rate system.

What Is the Relationship Between SGD and BND ?

The Singapore Dollar (SGD) and the Brunei Dollar (BND) share a distinctive and enduring relationship, underpinned by the Currency Interchangeability Agreement established in 1967. This agreement ensures that both currencies are accepted at par value in each country, allowing them to be used interchangeably for most transactions without any need for currency exchange. While the SGD and BND are mutually accepted in both Singapore and Brunei, the prevalence of each currency varies, with the SGD being widely accepted in Brunei and the BND less commonly used but still accepted in Singapore. Despite this interchangeability, Singapore and Brunei maintain independent control over their respective monetary policies, managed by the Monetary Authority of Singapore and the Autoriti Monetari Brunei Darussalam.

Is SGD a Strong Currency?

The Singapore Dollar (SGD) is recognized as a strong and stable currency in the Asian region, often compared to the Swiss Franc of Switzerland. This strength is evident in its consistent appreciation against the Malaysian Ringgit (MYR) since Singapore's independence in 1965. The SGD's robustness can be attributed to Singapore's resilient financial markets, stable monetary policy managed by the Monetary Authority of Singapore (MAS), and the city-state's reputation as a stable financial hub, which attracts significant investment, especially during times of global volatility. As of now, SGD is one of the most-traded currencies, underscoring Singapore's importance in international finance and trade.