Tag: big mac economy

Currency Exchange Tips for Hong Kong

1000 hong kong dollars

One thing that happens on every trip is the issue of exchanging currency into the local money. Hong Kong uses the “Hong Kong Dollar”, often indicated as an example as $1000HK or $1000HKD. Thankfully, for the moment at least, the currency of Hong Kong is “pegged” to the US dollar with a pretty solid rate, 0.13 or 7.76 Hong Kong dollars for 1 US dollar. Because of this official peg, your exchange rate to Hong Kong dollars is essentially based on whatever your exchange rate may be to US dollars. For Americans travelling to Hong Kong, let’s just say it makes it very simple.

There are tons of ways to exchange money in Hong Kong. First off, there are the exchange places at the airport. A recent survey showed them offering something near to 7 even, which is pretty poor rate. I never want to put down anyone’s business, but honestly, that exchange rate borders on criminal – 10% is a huge drop. The airport also has some currency exchange ATMs (Citibank, example) but I have never personally tried them, I don’t know what rate they give.

The best bet generally is to use your ATM card to make withdrawals directly from your home bank account, providing you take a reasonable amount of money. Most machines will limit you to $2500HK per transaction, which should be around $320 or so US at a time. Add to that a transaction fee, and whatever the banks take in the conversion, and you are still okay. At the official rate you are looking at $322, and one recent transaction I did (against a debit mastercard) was $333, or about 3%. That makes for a pretty big difference.

In town, there are currency exchange places just about everywhere, hanging out of every possibly nook and cranny and crevice in most areas. Keep an eye on both the rate and any fees they will charge you beyond the exchange, some have “no fees” beyond the displayed rates, while others will charge you for the service directly. Either way, check out what your net money would be and go with what works. If you get a street exchance over 7.5 these days you are doing pretty good. Some hotels also offer exchange services, but watch the rates, some of them are trying to profit from your ignorance about the exchange rates.

More than anything, avoid anyone who is offering to do money exchange on the street or “down an alley” to a side office or location. While Hong Kong is generally not dangerous this way, there are always some who will try to rip you off. Stay with actual exchange shops and you will do fine.

Finally, my basic rule for shopping. If you are any good at doing basic math in your head, when you are a hong kong store, just take the price you see and divide it by 7 to get the price in US dollars. You will give you a slightly inflated US price, but will also give you a pretty solid comparison after exchange and all that. In those terms, your Big Mac combo meal at McDonalds here costs under $4 US… nice!