MAS Tightening Keeps SGD Supported, Pair Under Pressure
Commerzbank analysts note that the Monetary Authority of Singapore unexpectedly tightened policy again, increasing the SGD NEER slope, which keeps the USD/SGD pair under downward pressure.
The Monetary Authority of Singapore (MAS) surprised markets by tightening monetary policy for the second consecutive meeting, according to Commerzbank. The central bank modestly increased the slope of the Singapore Dollar Nominal Effective Exchange Rate (SGD NEER) policy band while leaving its center and width unchanged.
This move reinforces the Singapore dollar’s appreciation trend, putting the USDSGD pair under sustained pressure. The analysts see the continued tightening as a signal of MAS’s commitment to containing inflation.
The policy adjustment adds upward momentum to the SGD, and the USDSGD exchange rate is likely to remain biased to the downside in the near term, Commerzbank notes.
Source: FXStreet Forex News