SINGAPORE: The Singapore dollar recently climbed to its highest value in nearly a decade, buoyed by the Monetary Authority of Singapore’s (MAS) hawkis
SINGAPORE: The Singapore dollar recently climbed to its highest value in nearly a decade, buoyed by the Monetary Authority of Singapore’s (MAS) hawkish stance in contrast to the U.S. Federal Reserve’s more dovish approach. By late last Friday, the Singapore dollar reached exchange rates not seen since 2014, hovering around 1.30 against the U.S. dollar in early Monday trading.
Since the start of 2024, the Singapore dollar has risen by about 1.5%, making it Asia’s second-best performing currency after the Malaysian ringgit. MAS’s decision to maintain an appreciating currency bias at its July meeting was part of an effort to curb inflation, boosting the currency’s appeal.
Another positive factor came from the upgraded GDP growth forecast, with Singapore’s government revising 2024 growth expectations to between 2% and 3%, up from a prior range of 1% to 3%, signaling stronger external demand. Meanwhile, the U.S. dollar softened as Federal Reserve Chair Jerome Powell signaled potential rate cuts ahead, likely starting next month.
Analysts expect the Singapore dollar to hold its strength if economic fundamentals and inflationary trends remain steady, while global investors keep a close watch on further policy shifts from the Federal Reserve that could impact the U.S. dollar’s path against Asian currencies.
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