Singdollar strengthens against pound but sharply weakens against USD after Brexit

Stock tickers along the wall at the SGX.
Stock tickers along the wall at the SGX. PHOTO: ST FILE

SINGAPORE (Bloomberg) - The Singapore dollar is 9 per cent stronger against the British pound on news that Britain has voted to leave the EU, but it is heading for its biggest decline in more than four years against the US dollar.

The Singdollar slumped 1.7 per cent to $1.3604 versus the greenback as of 12.42pm Friday (June 24) in Singapore, the biggest drop since November 2011, according to prices compiled by Bloomberg.

The Republic's bonds gained, with the yield on benchmark 10-year note falling three basis points to 2.01 per cent.

"The Singapore dollar depreciated when sterling was falling," said Mr Philip Wee, senior currency economist at DBS Group.

"Generally, Brexit means a weaker global outlook."

Singapore's currency has gained 4.2 per cent against the greenback this year, the best performance after the Japanese yen and Malaysian ringgit in Asia.

The currency has benefited from haven demand as the city-state enjoys the highest credit rating and a large current-account surplus, according to Khoon Goh, head of Asia research in Singapore at Australia & New Zealand Banking Group.