Singapore dollar trades at $1.23

The local currency has traded in a tight range all week.

IG Markets Singapore said:

SGD continues to have a settled trading pattern against the US dollar, having traded in a tight range - 1.2280 to 1.2320 - all week. It currently sits right in the middle of that range at 1.23.

We have seen other Asian and risk currencies lose ground to the greenback this week, while the Singapore dollar has shown resilience.

As we head into the MAS policy announcement tomorrow we are likely to see this pattern remain as traders hold fire ahead of that key decision.

It is widely expected that the permitted trading band slope will decrease and there are increasing numbers of analysts believing the band may be widened too.

OCBC Treasury Research noted:

The SGD NEER meanwhile is trading around +0.97% above its perceived parity (1.2420) with the extreme strong end of the fluctuation band estimated at around 1.2235. Look for the USD-SGD to ply a 1.2250-1.2350 range in the interim.

For tomorrow’s MAS Monetary Policy Statement, we continue to expect a slope flattening, with a potential band widening thrown in.