The recent forecasts and market updates indicate a complex interplay between the Singapore Dollar (SGD) and the Euro (EUR) as they navigate current economic landscapes.
The euro has recently found support against a backdrop of US dollar weakness, primarily influenced by anticipated policy divergence between the European Central Bank (ECB) and the Federal Reserve. Analysts noted that the euro's correlation with the USD has given it an upward trajectory, despite a lack of significant Eurozone data to drive immediate changes.
Meanwhile, the SGD has faced challenges stemming from adjustments in the Monetary Authority of Singapore's (MAS) policies. In January 2025, MAS eased monetary policy, which led to a more gradual appreciation of the SGD. A recent report highlighted that Singapore’s economy grew by 2.9% year-on-year in the third quarter, surpassing expectations, and the MAS has maintained its current policy stance in light of this strong performance. However, the SGD has not been immune to external pressures, particularly from ongoing trade tensions with the US.
Inflation dynamics also play a crucial role. Eurozone inflation slightly increased to 2.2% in November, contributing to the ECB's stance of maintaining rates stable. This suggests that the ECB may not need to ease monetary policy in the near future, providing some bullish sentiment for the euro.
In terms of exchange rates, the SGD to EUR is currently at 90-day lows near 0.6591, trailing just below its three-month average of 0.663. This stability indicates limited volatility, trading within a tight range of 1.1% recently. The oil market, which can heavily influence currency valuations, shows evidence of downward pressure in oil prices—trading at 30-day lows near $61.20, reflecting a 4.9% decline from its three-month average.
Overall, analysts suggest that the eur_SGD exchange rate may remain influenced by broader market trends and economic indicators. Given the current economic indicators, both currencies are poised to respond to ongoing geopolitical developments and monetary policy adjustments. Keeping abreast of these factors will be critical for individuals and businesses looking to optimize their international transactions.
