, Singapore

SARS playbook may slump currency to 2017 lows

MAS re-centered the policy band lower for the currency amidst the SARS outbreak in 2003.

Singapore’s currency may tumble to 2017 lows if the central bank mimics its response to that of the SARS epidemic two decades ago, said a report by Bloomberg.

The Monetary Authortiy of Singapore (MAS) re-centered the policy band lower for the currency in 2003 to deal with the fallout from SARS. UBS Group AG’s macro strategist Tan Teck Leng believes that should MAS repeat such action, the local dollar could dip through 1.40 versus the greenback.

The central bank has re-centered the band lower only three times since 2001, and it did so only after it had shifted to a neutral policy stance.

Singapore’s dollar has already slid 3.3% against the greenback this year, making it the worst-performing currency in Asia after Thailand’s baht.

Read the full report here.

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