- Singapore Dollar (SGD) rises for a fifth day
- MAS is not expected to cut rates
- US Dollar (USD) falls versus major peers
- US CPI inflation eased to 2.9% YoY
The US Dollar Singapore Dollar (USD/SGD) exchange rate fell for a fifth straight day on Wednesday. The pair fell -0.53% in the previous session, settling on Tuesday at 1.3170. At 21:00 UTC, USD/SGD trades -0.04% at 1.3164 and is in a range of 1.3141 to 1.3181.
The Singapore dollar extended gains, rising to an 18-month high versus the US dollar amid expectations that the local central bank will keep managing apostasy tighter relative to the Federal Reserve.
The Singapore dollar is on track for its largest monthly gain in August since 2023 and is the second performer among Asian currencies this year.
The Monetary Authority of Singapore is not expected to cut interest rates until next year, later than the Federal Reserve, which could make a move as soon as next month.
The Singapore economy is expected to grow between 2% and 3% this year, and investors will also be watching non-oil domestic export data, which is due on Friday and is expected to show a slight rebound.
The US Dollar is falling across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades -0.04% 102.57 at the time of writing, marking the third straight day of losses.
The U.S. dollar is falling off the US inflation data, suggesting that the Federal Reserve is still on track to cut interest rates next month.
US inflation, as measured by the consumer price index, eased to 2.9% year on year in July, down from 3% in June and in line with forecasts. This marked the first time That inflation fell below 3% since March 2021.
The data supports the view that the Federal Reserve will start cutting rates in September. The market is fully pricing in a 25-basis-point rate cut in September and a 37% chance of a 50-basis-point rate cut.
