Bias: bearish-to-range-bound; current level sits below the 90-day average and in the lower half of the three-month range (trading within a defined band), with a risk of a dip toward the lower end if USD resilience persists as markets reassess Fed policy.
Key drivers:
- Rate gap: The Fed is expected to ease toward neutral in coming years, while MAS remains accommodative.
- Macro factor: US unemployment fell to a multi-year low, boosting USD demand.
- Global risk appetite: Markets have traded mixed; USD tends to firm when investors move to safer assets, while SGD remains sensitive to trade news.
Range: Recent price action shows USD/SGD trading within a defined three-month band, with the pair hovering near the lower end and likely to drift only gradually in the near term.
What could change it:
- Upside risk: a firmer US payroll report or signals the Fed will keep rates higher for longer could lift USD.
- Downside risk: softer US data or a clearer path to rate cuts could weigh on USD/SGD.
