8 Nov 2013
Flash: Scope for further SGD appreciation limited - ANZ
FXstreet.com (Barcelona) - Scope for further SGD appreciation is limited on the basis of approaching the upper band of its allowed trading range by the Monetary Authority of Singapore, notes Khoon Goh, Senior FX Strategist at ANZ.
Key Quotes
"Our new estimate suggests that the S$NEER is closer to the upper bound than previously thought. At present, we estimate that the S$NEER is 1.6% above the midpoint, and recently has been as high as 1.8% above the midpoint. This means that there is limited scope for further SGD appreciation."
"In USD/SGD terms, we put the upper bound at 1.2400/10. As the S$NEER gets closer to the upper bound, we can expect
greater FX intervention activity from MAS. Indeed, it is perhaps no surprise that MAS’s official reserve assets increased by USD3.7bn to USD271.8bn in the month of October."
Key Quotes
"Our new estimate suggests that the S$NEER is closer to the upper bound than previously thought. At present, we estimate that the S$NEER is 1.6% above the midpoint, and recently has been as high as 1.8% above the midpoint. This means that there is limited scope for further SGD appreciation."
"In USD/SGD terms, we put the upper bound at 1.2400/10. As the S$NEER gets closer to the upper bound, we can expect
greater FX intervention activity from MAS. Indeed, it is perhaps no surprise that MAS’s official reserve assets increased by USD3.7bn to USD271.8bn in the month of October."