Outlook
The SGD is likely to stay within a tight range near current levels. Domestic growth remains resilient and inflation is subdued, supporting an accommodative MAS stance. However, ongoing US trade frictions and policy shifts could cap upside for the SGD versus the USD. Near-term momentum appears balanced, with the SGD likely to drift on evolving trade dynamics and global risk sentiment.
Key drivers
- Domestic growth strength and the MAS policy path: accommodative policy supports growth but can temper SGD strength.
- External trade environment: US tariffs on Singaporean goods (from April 2025) pose a headwind for Singapore’s export sector and the SGD.
- Inflation dynamics: low core inflation provides space for MAS to stay accommodative, influencing SGD direction.
- Global risk sentiment and USD moves: broad market moves and risk appetite can push SGD in either direction, especially against the USD.
Range
SGDUSD: 0.7856; 3-month avg 0.7762; range 0.7644–0.7934
SGDEUR: 0.6648; near 3-month avg; range 0.6593–0.6696
SGDGBP: 0.5770; below 3-month avg; range 0.5730–0.5863
SGDJPY: 123.5; 1.9% above 3-month avg 121.2; range 118.0–123.7
What could change it
- A material shift in MAS policy stance (tighter or more hawkish) would support the SGD.
- Resolution or escalation of US-Singapore trade tensions could alter export outlook and SGD direction.
- Unexpected changes in inflation or growth data in Singapore could prompt policy reassessment.
- A sustained shift in global risk appetite or USD strength could push SGD movements beyond the current range.
