The current market bias for the AED to SGD exchange rate is range-bound.
Key drivers include the interest rate differential, as the UAE's Central Bank continues to promote economic stability through the upcoming Digital Dirham, while Singapore's Monetary Authority has maintained an easing stance. Additionally, both economies are projected to experience strong growth, with the UAE's GDP forecasted to rise significantly in the next few years, alongside Singapore's revised growth outlook.
The near-term trading range for the AED to SGD is expected to remain stable, given recent price data showing the rate near 0.3504, close to its 3-month average.
An upside risk could arise from stronger-than-expected economic data from the UAE that strengthens the Dirham further. Conversely, a downside risk may emerge if Singapore's economic growth unexpectedly weakens, impacting the Singapore Dollar's relative strength.