S$NEER continued to ease; last at 0.9% above model-implied mid. Looking back, SGD has been easing since Oct-2024 on trade-weighted terms even as MAS maintained policy status quo. Pair was last seen at 1.3431.
Signs of some degree of bearish pullback in the near term
“That said, SGD remains stronger vs. peers in the basket but it is just less strong today (vs. than for most of the year). Historically the positive correlation between the change in S$NEER and MAS core inflation shows that SGD strength can ease when core inflation eases materially. Monday’s release of CPI report saw both headline and core CPI surprised to the downside. The sharp pullback has also led to chatters if MAS would ease soon at the next MPC in Jan-2015.”
“We think there is no hurry to ease amidst many moving parts – tariff threats, geopolitics – which may see price pressures return. MAS is better off monitoring further to avoid any risk of flip-flopping on policy. MAS maintaining policy status quo suggests that SGD can still remain somewhat resilient on trade-weighted terms. At some point in 2Q or 3Q in 2025, MAS may ease policy if core CPI does ease further.”
“USD/SGD eased, alongside the pullback seen in broad USD. Mild bullish momentum on daily chart continues to fade while RSI is flat. Bearish divergence on MACD appears to be playing out. Technical patterns suggest signs of some degree of bearish pullback in the near term. Support at 1.3410, 1.3340 (200 DMA) and 1.3290 (61.8% fibo retracement of Jun high to Oct low). Resistance at 1.3520 levels.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
US PCE inflation data to ramp up volatility ahead of Thanksgiving – LIVE
The Personal Consumption Expenditures (PCE) Price Index, the Fed's preferred gauge of inflation, data for October will be scrutinized by markets ahead of the Thanksgiving Day holiday. Investors remain undecided about the possibility of one more Fed rate cut in December.
EUR/USD extends recovery beyond 1.0550 on renewed USD weakness
EUR/USD preserves its bullish momentum and trades above 1.0550 in the American session on Wednesday. The US Dollar (USD) struggles to find demand following the mixed macroeconomic data releases from the US, helping the pair push higher ahead of US PCE inflation data.
GBP/USD advances toward 1.2650, US PCE data eyed
GBP/USD extends the bullish momentum to trade near 1.2650 in the second half of the day on Wednesday. The pair benefits from a sustained US Dollar weakness ahead of the Thanksgiving Day holiday. Investors await PCE Price Index figures for October.
Gold climbs to $2,650 area as US yields push lower
Gold builds on Tuesday's gains and trades at around $2,650 in the American session. The benchmark 10-year US Treasury bond yield is down more than 1% on the day below 4.3%, helping XAU/USD continue to push higher.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.