- Singapore dollar (SGD) rises for a second day
- China retaliates with tit for tat tariffs on the US
- US Dollar (USD) falls after Trump applied tariffs to Mexico, Canada & China
- Fears rise of an economic downturn
The US Dollar Singapore dollar (USD/SGD) exchange rate is falling on Tuesday for a second day. The pair fell 0.3% in the previous session, settling on Tuesday at 1.3465. USD/SGD trades -0.45% at 1.3404 and traded in a range of 1.3401 and 1.3471.
The Singapore dollar is rising despite President Trump starting a trade war on multiple fronts. Trump announced an additional 10% trade tariffs on China, bringing the total 20%. This was met by reciprocal tariffs from China on US imports, some starting as soon as this week.
The tariffs come as China’s economy is still struggling to recover amid weak consumer spending and an ongoing property crisis.
Attention will now turn to the China Two Sessions, which starts tomorrow and will focus on the Chinese economic outlook and how it may deal with Trump.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades at 106.29, down 0.3%, extending yesterday’s losses.
The US dollar has fallen to a three-month low against its major peers amid concerns over slowing growth and the impact of tariffs on the US economy. Trump announced 25% tariffs on Mexico and Canada and a further 10% levy on China.
The announcement of the trade tariffs comes as recent data has raised concerns over the economic outlook. Business and consumer confidence data have been weaker than expected as businesses and households fret over the impact that tariffs may have.
The market is now pricing in three 25-basis-point Fed rate cuts this year, up from two rate cuts at the end of last week.
Investors are bracing themselves for Trump’s address to the US Congress, which could deliver further surprises. Attention will also be on the US non-farm payroll, which could provide further insight into the health of the US jobs market.
