Outlook
The SGD is expected to remain broadly supported by Singapore’s resilient growth and a policy framework that gradually manages the pace of SGD appreciation. MAS shifted the pace of appreciation lower in early 2025 to back economic activity, a stance that persisted into mid-2025 and supported a contained SGD path. Markets increasingly factor in further SGD appreciation into 2026 if global growth stays firm, but external risks, notably US tariff developments, can cap gains in the near term. The latest price action shows the SGD holding near 14-day highs against the USD, reflecting modest upside risk versus a backdrop of trade tensions and steady domestic momentum.
Key drivers
- MAS policy: January and April 2025 adjustments slowed the SGD’s appreciation pace to support growth, shaping a more gradual currency path.
- Trade tensions: Tariffs on Singaporean exports (notably in pharmaceuticals and semiconductors) in 2025 added a headwind for SGD, keeping downside risk in play.
- Domestic economy: Singapore posted resilient growth (GDP up in mid-2025), reinforcing the case for a calibrated policy stance and a stable, range-bound SGD.
- Market expectations: Analysts projected SGD to trade within a defined range in 2025, with expectations of further appreciation in 2026 if global conditions improve.
- Current price action: SGD/USD sits near 14-day highs, with the pair trading in a clear, narrow band around recent highs, signaling a measured upside bias but sensitivity to external shocks.
Range
SGD/USD: 0.7644-0.7934; 14-day high near 0.7924; 3-month average 0.7786
SGD/EUR: 0.6593-0.6696; 14-day high near 0.6685; 3-month average 0.6641
SGD/GBP: 0.5730-0.5863; current around 0.5813 near 3-month average
SGD/JPY: 119.5-123.8; current around 121.6 near 3-month average
What could change it
- MAS policy shifts: any move to accelerate or reverse SGD appreciation could redefine the range and near-term direction.
- Trade developments: a resolution or escalation of US-Singapore tariff tensions could lift or weigh the SGD accordingly.
- Global growth and risk sentiment: clearer improvement or deterioration in global demand may push the SGD higher or lower via shifts in risk appetite.
- Major USD moves: sustained USD strength or weakness can tilt SGD pairs in the near term.
