Singapore: Position for a widening US-SG spread - ANZ

Sandeep Kanihama FXStreet Contributor

Analysts at ANZ are expecting the Monetary Authority of Singapore (MAS) to be on hold at the April policy review, continuing its modest and gradual S$NEER appreciation stance.

Key Quotes

“We think it is only a pause, with possibly further tightening down the track. We do not expect the MAS to ease.”

“We think Singapore exports may be bottoming. Historically, US-SG rate spreads tend to widen if Singapore's growth is picking up while US growth holds well. After narrowing since late 2018, we expect US-SG rate spreads to re-widen.”

“We recommend paying 5Y US IRS 5Y forward (5Yx5Y), at 2.66%, and receiving 5Y SG IRS 5Y forward (5Yx5Y), at 2.49%. We expect the spread to widen from 17bps currently to 45bps, with stop loss at 0bps.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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