Singapore Dollar: Upside risk capped against US Dollar – UOB
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note USD/SGD stayed broadly flat on Wednesday, trading between 1.2804 and 1.2825 and closing at 1.2810.
UOB analysts Quek Ser Leang and Lee Sue Ann reported that the USD/SGD exchange rate remained relatively stable on Wednesday, fluctuating between 1.2804 and 1.2825, closing at 1.2810. According to their Nominal Effective Exchange Rate (NEER) model, the Singapore Dollar (SGD) will continue to stay 1.5–2.0% above its midpoint, indicating a potential range of 1.2756–1.2820.
In the near term, downside risks prevail, but a significant drop below 1.2790 is needed for further declines. Over the past two days, the USD moved within a range of 1.2815/1.2840 and closed nearly unchanged at 1.2819. Yesterday, the analysts had predicted that the USD would trade within a range of 1.2805–1.2840. Today, the USD might dip slightly, but given the minimal downward momentum, the decline is unlikely to reach 1.2790.
Resistance levels are at 1.2820 and 1.2830. Looking ahead, the analysts will keep monitoring the 1.2790 level, as a break below this point would suggest further downside risks.
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