Singapore dollar (SGD) Market Update
In October, the Singapore dollar (SGD) experienced a notable depreciation against the US dollar (USD), reversing gains achieved in the preceding months as market participants remained cautious amid uncertainty surrounding US interest rate policies and the upcoming November elections. Analysts observed that the SGD is currently trading at 0.7315 against the USD, which is 1.7% below its three-month average of 0.7443. This reflects a consistent trading pattern within a stable 4.7% range from 0.7290 to 0.7634, further highlighting traders' risk-averse stance as they await clearer signals from the Federal Reserve.
Despite this recent weakening, Singapore's economic resilience remains strong, prompting economists to upgrade the nation's 2024 growth forecast to 3.5%, up from the previous estimate of 2%-3%. The Ministry of Trade and Industry reported a third-quarter GDP rise of 3.2% quarter-on-quarter, indicating robust recovery momentum within the local economy. The SGD is currently performing well against the Euro and the Japanese yen, trading at 0.7100 (0.7% above the three-month average) and 115.6, respectively. These movements suggest that while uncertainty in the USD-SGD pairing persists, the SGD maintains relative strength against other major currencies. As the Monetary Authority of Singapore maintains a hawkish monetary policy, market views are mixed; traders are keenly monitoring US economic indicators and local inflation data for further cues on the SGD's direction.
