THE CHARTIST: SGD TO FUR­THER AP­PRE­CI­ATE

Singapore Business Review - - FIRST -

The Sin­ga­porean dol­lar has con­sis­tently ap­pre­ci­ated since the be­gin­ning of the year, strength­en­ing at ap­prox­i­mately 7%. An­a­lysts at BMI Re­search said the SGD is set to con­tinue strength­en­ing with an av­er­age of around SGD1.38/USD in 2017 and SGD1.34/USD in 2018. Strength in the Chi­nese yen re­sulted to the SGD’S past ap­pre­ci­a­tion, but go­ing for­ward, pos­i­tive growth in­fla­tion dy­nam­ics in the US will be the pri­mary fac­tor to­gether with an un­der­val­ued ex­change rate and strong ex­ter­nal po­si­tion. How­ever, an­a­lysts ex­pect the cur­rency to drag slightly as the Mone­tary Au­thor­ity of Sin­ga­pore (MAS) en­deav­ours to keep the city’s ex­ports com­pet­i­tive. In the short term, the drag in ap­pre­ci­a­tion is likely to be caused by an over­bought cur­rency and the SGD trad­ing at the lower cur­rency band of MAS.

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