The Singapore Dollar (SGD) is navigating a challenging environment influenced by recent monetary policy adjustments and broader economic concerns. In January 2025, the Monetary Authority of Singapore (MAS) made its first monetary policy easing since 2020, decreasing the rate of appreciation of the Singapore dollar nominal effective exchange rate (S$NEER) band to counteract slower inflation and economic growth. Further cuts were made in April 2025, as escalating U.S. tariffs and a revised GDP growth forecast prompted the MAS to lower the S$NEER appreciation rate. The anticipated GDP growth for Singapore has been revised down to a range of 0% to 2% for 2025, significantly influenced by weakness in the manufacturing and services sectors.
The introduction of U.S. tariffs is expected to trigger a negative shock to Singapore's economy, adversely impacting key industries such as steel, aluminum, and automobiles. To provide a strategic response to these external pressures, Singapore has initiated a comprehensive economic strategy review aimed at bolstering its position as a global trade and financial hub.
In terms of recent performance against major currencies, the SGD to USD exchange rate is currently at 0.7742, which is just 0.5% below its 3-month average of 0.7784, with stability observed in a range between 0.7704 to 0.7853. The SGD to EUR is trading at 0.6607, near 7-day lows and 0.8% below its 3-month average of 0.666. The range for SGD to EUR has been stable at 0.6597 to 0.6764. Meanwhile, the SGD to GBP is recorded at 0.5764, slightly below its 3-month average, staying within a 1.8% range from 0.5743 to 0.5846. The SGD to JPY exchange rate stands at 115.8, which is 0.7% above its 3-month average of 115, maintaining a narrow range of 113.5 to 116.1.
Analysts highlight that these recent moves in the SGD market reflect ongoing economic adjustments in response to both domestic and international pressures. Individuals and businesses involved in international transactions may benefit from closely monitoring these developments as the SGD's outlook continues to evolve amid these significant economic changes.
