Singapore dollar weakens amid drop in NODX figures

Local currency likely to move firmly above 1.24.

IG Markets Singapore said:

Having moved up to 1.24 in early trade yesterday, USD/SGD has traded either side of that mark since.

The initial SGD weakness from the disappointment of the NODX numbers missing expectations has set the tone for the cross potentially moving firmly above 1.24 in the coming weeks.

With all eyes now on final Q4 GDP which is due on Friday, if we see further weakness from this data it is likely to feed through to our currency.

Meanwhile, OCBC Treasury Research noted:

Regarding the USD-SGD, the NEER is currently around +0.82% above its perceived parity (1.2495) with the extreme strong end of the NEER fluctuation band estimated at around 1.2310 given current market conditions.

In the interim, expect USD-SGD to ply a familiar 1.2330-1.2430 band with the 200-day MA (1.2414) still as yet unchallenged on a sustained basis.