EUR/SGD Outlook: Slightly weaker, but likely to move sideways, as the rate is below its recent average and situated near its recent low.
Key drivers:
• Rate gap: The European Central Bank (ECB) is expected to maintain a neutral monetary policy, while Singapore's Monetary Authority has adopted a more accommodative stance, creating pressure on the SGD.
• Risk/commodities: Oil prices are above average, which generally supports the Euro due to the Eurozone's energy security concerns linking their economy to global oil trends.
• One macro factor: The ongoing trade tensions and potential tariffs proposed by the U.S. may keep the SGD under pressure amid global economic uncertainties.
Range: The EUR/SGD rate is likely to drift within its recent range as competing pressures balance out.
What could change it:
• Upside risk: A resolution of trade tensions or positive economic sentiment in Europe could strengthen the euro.
• Downside risk: Further escalations in tariff disputes could weaken the SGD and heighten uncertainty, impacting the EUR/SGD exchange.
