50 years ago
MACAO (May 19): BUSINESS men have been somewhat irritated by brusque changes in the exchange rate between Macao patacas and Hongkong dollars during the last two days.
Based originally on the Mexican peso, Macao and Hongkong currency were generally interchangeable for many years.
With the extension of the World War to the Pacific at the end of 1941, speculators began then to depress the Hongkong dollar in terms of patacas, and holders of Hongkong currency arriving in Macao found that their money was being steadily depreciated in the money market. The principal operators in the currency racket were money changers who moved over from Hongkong.
With the end of the War, conditions approached normal, and for a number of months there was little difference between the two currencies. About a month ago, speculators depreciated the Hongkong dollar on the Macao market by about twenty per cent, and it was some time before merchants adapted themselves to the change. Owing to recent political changes in China, and with the advent of refugees and evacuees with Hongkong currency a sudden demand for Macao patacas began again, and a further drop of about ten per cent was registered.
During the last two days, there has been further heavy selling of Hongkong currency, at one time to-day the rate for patacas rose to 59 patacas for $100, Hongkong currency. The rate steadied a little later in the day, and closed at 65. The explanation offered is that holders of Hongkong currency have been trying to buy Macao money in the open market thereby pushing down the Hongkong dollar.