|

Singapore Dollar: Rebound seen relatively capped against US Dollar – OCBC

OCBC strategists Sim Moh Siong and Christopher Wong note that USD/SGD has eased with the softer US Dollar (USD) and lower US yields, while Singapore’s import prices show strong energy-driven inflation. They retain a constructive medium-term view on the Singapore Dollar (SGD) but expect any USD/SGD pullback to stay shallow unless broader USD weakness deepens, with key support and resistance levels guiding near-term two-way trading.

Energy-driven inflation and range levels

"USD/SGD eased overnight, tracking the pullback in USD and US Treasury yields despite stronger-than-expected US GDP and still-elevated inflation. The mixed market response suggests that conviction on the next leg higher in USD remains limited, although resilient US activity and persistent price pressures may also continue to restrain USD declines."

"We retain a constructive medium-term SGD outlook, although scope for further trade-weighted outperformance may be limited with the S$NEER already trading in the upper half of the policy band. Near term, USD/SGD remains sensitive to USD, US Treasury yields and RMB developments. Any pullback in USD/SGD may remain relatively shallow in the interim unless we see a more meaningful decline in the broader USD."

"On the domestic front, Singapore’s September import prices rose 19.9% YoY, accelerating from 15.5% in August, largely driven by higher energy costs. Oil import prices surged 78.5% YoY, while non-oil import price inflation moderated slightly to 4.4% from 4.8%."

"The divergence suggests that imported price pressures remain largely energy-driven for now, although sustained increases in oil prices could eventually feed into broader inflation. Imported inflation risks remain a consideration for MAS, which maintained its appreciating S$NEER policy stance in October."

"Daily momentum is not indicating a clear bias while decline in RSI moderated. 2-way trades likely for now."

"Support at 1.2760 (50 DMA), 1.2740 (61.8% fibo retracement of 2026 low to high). Resistance at 1.2820/50 levels (100 DMA, 38.2% fibo)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

More from FXStreet Insights Team
Share:

Editor's Picks

AUD/USD edges higher as hot CPI inflation and hawkish RBA lift rate hike bets

The AUD/USD pair gathers strength to near 0.7035 during the Asian trading hours on Friday. The Australian Dollar edges higher against the US Dollar as hotter Australian CPI inflation data has bolstered expectations of Reserve Bank of Australia rate hikes.

USD/JPY meets support near 157.00

USD/JPY retreats for the third consecutive day on Friday, revisiting the 157.00 region before attempting some recovery as investors continue to assess the latest BoJ meeting, where the central bank left rates unchanged, as widely anticipated.

Gold sinks to fresh yearly lows despite risk-off mood as Fed rate hike bets weigh

Gold slips to fresh year-to-date lows on Friday. The metal struggles despite a risk-off mood across markets, as expectations of further Federal Reserve (Fed) interest rate hikes continue to dominate price action, leaving Gold on track to end the month in negative territory.


Ripple Price Forecast: XRP bulls defend $1.20 as sell-side pressure triggers liquidations
Ripple (XRP) trades around $1.25 on Friday, rising from a short-term support level established at $1.20. This minor upward correction follows a sharp sell-off, triggered amid reports of a hack attack on the Binance exchange that impacted approximately $6.3 billion. The attack drove the broader crypto market on edge, as Binance suspended both deposits and withdrawals to contain the situation.
BoJ recap: A pause for now... but Japan has entered a new inflation phase
The Bank of Japan left its short-term policy rate unchanged at 1.25% but delivered a distinctly hawkish message on the risk of an inflation overshoot. The decision passed by 8-1, with board member Takata dissenting in favour of an increase to 1.5%, while Governor Kazuo Ueda stressed that the Bank would continue adjusting policy as needed.
A hot US economy is supposed to sink Gold. It didn't. Here's why
Gold (XAU/USD) remains under pressure near $4,000, as stronger-than-expected United States (US) economic data reinforce expectations of another Federal Reserve (Fed) interest rate hike in December. Economic growth is accelerating, inflation remains elevated, and borrowing costs could rise further.