SGD/PKR Outlook:
The SGD/PKR rate is slightly positive and likely to move sideways, as it is above its recent average and positioned near the top of its 3-month trading range without a clear current driver.
Key drivers:
• Rate gap: The Monetary Authority of Singapore has maintained a policy to support the SGD, while the State Bank of Pakistan is focused on controlling inflation with a stable interest rate.
• Risk/commodities: The Singapore Dollar's strength is supported by resilient GDP growth, despite trade tensions impacting key exports.
• One macro factor: Pakistan shows signs of economic recovery, with improved foreign exchange reserves and efforts to stabilize inflation.
Range:
Expect the SGD/PKR exchange rate to hold steady in its recent range, reflecting balanced conditions overall.
What could change it:
• Upside risk: A stronger-than-expected economic performance in Singapore could boost the SGD further.
• Downside risk: Significant deterioration in global trade relations could weaken the SGD against the PKR.