US dollar decline damaging expats in Asia

The US dollar, so long the mainstay and currency basis of Asian economies, is hurting – taking expats down with it. A new survey by ECA International, a human resources consultancy, shows that expats based in the major Asian centres are feeling the pinch as the declining dollar is making their daily expenses higher.

The US dollar exchange rate has fallen by around 30 percent in most Asian countries over the past year. In addition, the weakening pound has also meant that expat purchasing power is nowhere near what it was just a short time ago, with simply grocery shopping to upmarket restaurant dining all increasing significantly in price.

The ECA findings show that expats based in Japan are worst off with the strength of the yen. While exchange rates have suffered in Southeast Asian countries such as Thailand, Cambodia and Laos, where the euro is now the preference of local operators, those countries that are not pegged against the dollar have all risen in living costs. This means that Japan, South Korea, Singapore and Indonesia all require higher living allowances than just one year ago.

Japan remains the most expensive Asian country to live in. The US dollar hit a 14-year low against the Yen recently.

The ECA survey covers costs of an average basket of 125 supermarket items from 390 locations across the world.