WSJ:Singapore Dollar Flat Late as It Hovers Near Strong End of Estimated Band
Latest Change
USD/SGD 1.2440 +0.0003
Overnight Rate 0.01% -18 bps
2-Year Bond Yield 0.34% Unchanged
10-Year Bond Yield 2.30% +1 bp
2-Year Swap Offer 0.52% -1 bp
10-Year Swap Offer 2.63% +1 bp
2-10-Year Swap Curve 211 bps +2 bps
SINGAPORE--The Singapore dollar was little changed against the U.S. dollar late Wednesday in Asia as investors bet the island nation's currency is near the higher end of its valuation.
The U.S. dollar was quoted at S$1.2440 in the last hour of Asian trading with traders waiting for fresh cues to act on. Earlier, the U.S. currency had fallen to S$1.2425.
Traders said the Singapore dollar is currently near the strong side of its trading band against a basket of other currencies, thus motivating investors to reduce bets on further strength for now.
The Monetary Authority of Singapore allows the local dollar to trade within a dynamic range that currently has a gentle incline to allow for gradual currency appreciation - to counter imported inflation.
The central bank doesn't reveal the band limits or exactly how it's derived, leaving banks to use mathematical models to estimate the band.
The U.S. dollar may stay supported, despite a weaker U.S. dollar index triggered by dovish comments from Federal Reserve Chairman Ben Bernanke who said late Tuesday that U.S. interest rates will stay low even after the jobless rate drops to the Fed's target level.
Singapore government bonds were steady, with the yield on the benchmark two-year bond unchanged at 0.34%. Yield on the 10-year bond ticked up by a hundredth of a percentage point to 2.30%.
