Singapore dollar sustains gains

The local currency started the week testing the $1.24 level, says IG Markets Singapore.

IG Markets Singapore said:

The local currency continues to gain on the US dollar, starting the week testing the $1.24 level.

Friday saw non-farms payroll data come in much stronger than expected which saw a shift to risk-on trading.

The positive economic data, although it didn’t see US employment fall, was enough to weaken the dollar against major currencies.

Traders are still concentrating on sentiment rather than fundamentals. There will be less focus on the US this week as attention shifts towards China and release of economic data from the Middle Kingdom.

The greenback fell against the Singapore dollar falling to $1.2404 this morning as a bout of optimism enters the trading week.

OCBC Treasury Research meanwhile noted:

Emerging market currencies jumped against the dollar in line with improved global sentiment and expect USD-Asia to be heavy at the onset of the week.

The SGD NEER currently is around +0.92% above its perceived parity (1.2520) with the strong end of the NEER fluctuation band estimated at around 1.2275.

Expect market wariness at around the 1.2400 area with the USD-SGD seen in a 1.2375-1.2475 band intra-day pending further cues from the majors.