USD/SGD – Singapore Dollar Holds Steady, Shrugs off Soft CPI

USD/SGD has posted small losses on Monday, as the pair trades just above the 1.35 line in the European session. In economic news, Singapore CPI posted a decline of 1.0%. It’s a quiet start to the week in the US, with just one event on the schedule – New Home Sales.  The markets are expecting an improvement in the March report, with an estimate of 521 thousand. On Tuesday, the US will publish two major events – Core Durable Goods Orders and CB Consumer Confidence.

Singapore released its year-on-year CPI for March, and the index came in at -1.0%, its lowest level since 1986. It also marked a 17th consecutive month that CPI has declined. The inflation picture was a bit brighter on a month-month basis, as CPI edged up to 0% in March, compared to -0.1% a month earlier. Earlier this month, the Monetary Authority of Singapore (MAS) surprised the markets and announced that it was adopting monetary easing in order to curb the appreciation in the value of the Singapore dollar. The MAS said that it was shifting away from its previous policy stance of a “modest and gradual” appreciation of the Singapore dollar, and would instead set the appreciation of the currency’s nominal effective exchange rate policy band at zero percent.

The US manufacturing sector remains a sore spot in the generally strong economy. Last week, the Philly Fed Manufacturing Index surprised the markets with a decline of -1.6 points, as the estimate stood at 8.1 points. This reading marked the third decline in four readings, as the manufacturing sector remains a weak area of the US economy. On Friday, US Flash Manufacturing PMI dipped to 50.8 points, shy of the forecast of 51.9 points. Although the reading did point to a slight improvement in manufacturing business conditions, it marked the PMI’s weakest release since September 2009. Uncertainty in global economic conditions has lead to weaker demand for US goods and weakened the manufacturing sector, a trend which has negatively affected producers in the US and elsewhere, such as the Eurozone and Japan. Meanwhile, the robust US labor market continues to impress. The weekly unemployment claims indicator fell to 247 thousand on Friday, well below the forecast of 265 thousand. This was the lowest weekly count since November 1973. As well, the unemployment claims four-week moving average, which is considered more accurate than the weekly indicator, also dropped compared to the previous release.

USD/SGD Fundamentals

Monday (April 25)

  • 10:00 US New Home Sales. Estimate 521K

Tuesday (April 26)

  • 18:30 US Core Durable Goods Orders. Estimate 0.6%
  • 10:00 US CB Consumer Confidence. Estimate 95.8 points

*Key events are in bold

*All release times are EDT

USD/SGD for Monday, April 25, 2016

USD/SGD April 25 at 8:30 EDT

Open: 1.3542 Low: 1.3508 High: 1.3501 Close: 1.3507

USD/SGD Technical

S3 S2 S1 R1 R2 R3
1.3145 1.3279 1.3401 1.3535 1.3639 1.3721
  • USD/SGD has posted small losses in the Asian and European sessions
  • 1.3535 is a weak resistance line
  • There is support at 1.3401
  • Current range: 1.3401 to 1.3535

Further levels in both directions:

  • Below: 1.3401, 1.3279 and 1.3145
  • Above: 1.3535, 1.3639, 1.3721 and 1.3854

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.