SINGAPORE (Dow Jones)--The Singapore dollar was a tad higher late in Asia, making up for losses earlier in the day due to fresh optimism that a deal may be reached soon in the ongoing Greek debt negotiations, which pushed the greenback lower against currencies such as euro and yen.
The U.S. dollar was quoted at S$1.2559 in the closing moments of Asian trade, compared with S$1.2581 around the same time on Monday. The greenback touched a low of S$1.2530 during the session after earlier being quoted as high as S$1.2614.
The local unit also got a boost from data that showed Singapore's seasonally adjusted unemployment rate stood unchanged at 2.0% in the fourth quarter, and at 2.0% as well for the whole of 2011--the country's lowest annual unemployment figure in 14 years.
United Overseas Bank and DBS Bank analysts said the Singapore dollar might not gain significantly more from its current level in the near term. DBS Bank said it didn't expect the U.S. dollar to fall below S$1.2500, while UOB tipped a S$1.2455 floor.
Most analysts attribute the current strength of the local dollar and of other relatively riskier assets to a relief rally and to hopes that the European sovereign-debt situation is improving.
Speaking in Brussels early Tuesday, Greek Prime Minister Lucas Papademos raised hopes that a deal on a second bailout could be struck by the end of the week with the European Union, the European Central Bank and the International Monetary Fund, citing significant progress in Greece's talks with its private creditors.
Singapore government bonds were little changed as traders awaited fresh cues from Europe.
The yield on the benchmark 10-year bond was lower by one basis point, or a hundredth of a percentage point, at 1.54 after falling quite sharply in the previous three sessions. The yield on the two-year bond was unchanged for the fourth day straight, at 0.30%.
-By Gaurav Raghuvanshi; Dow Jones Newswires; +65 64154 154; gaurav.raghuvanshi@dowjones.com
