Analysts expect Sing$ to rise against major partners
The Singapore dollar is unlikely to see much appreciation against its major trading partners in the months leading to the year end, said foreign exchange analysts.
Some expect the US dollar to appreciate to about $1.24 against the Singdollar by the year end. This is because most analysts expect the Monetary Authority of Singapore (MAS) to loosen its monetary policy, as it focuses on tackling the slowing economy instead.
The MAS uses the exchange rate as the main tool to balance between inflation from overseas and growth. Keep the Singdollar too high to fight inflation and exporters suffer, while the obverse may benefit exporters but penalise consumers with steep inflation.
In the current slow-growth environment, the MAS is expected to continue letting the Singdollar appreciate against its major trading partners, but at a slower pace. This should allow the US dollar to appreciate to about $1.24 against the Singdollar by the year end, from the current $1.2291, said United Overseas Bank (UOB).