U.S. Dollar's Uptrend Vs. Singapore Dollar Likely Nearing an End, Charts Show — Market Talk

The Singapore dollar strengthens against its U.S. counterpart on likely position adjustments by market participants ahead of incoming U.S. President Trump's inauguration later today. Trump has promised to issue executive orders "hours" after he's sworn in, focusing on immigration, energy and government reforms, Maybank analysts say in an FX Research & Strategy report. "Any sign of a scale-back compared to the pledges he had made before in his campaigns could swing the USD lower given how much expectations (and fears) are being priced into the USD," the analysts add. USD/SGD is 0.3% lower at 1.3657. (ronnie.harui@wsj.com)

Asian currencies consolidate against the dollar in the morning session but may be supported by hopes for Fed rate cuts that would spur risk-on sentiment. There were dovish comments from Fed Gov. Waller overnight, National Australia Bank's Rodrigo Catril says in a commentary. Waller said that if future inflation figures fall in line with December's readings, the Fed may cut rates more this year and sooner than investors are currently expecting, the senior FX strategist notes. USD/KRW is down 0.3% to 1,454.04; AUD/USD is 0.1% lower at 0.6212; USD/SGD is steady at 1.3665. (ronnie.harui@wsj.com)

The Singapore dollar is steady against its U.S. counterpart in the Asian session and could be supported by Fed rate-cut hopes. A downside surprise in the U.S. December core CPI data released Wednesday had led to the swaps market pricing in the next Fed rate cut by the July meeting, RBC Capital Markets' Alvin T. Tan says in an email. Strong U.S. bank earnings overnight also boosted risk sentiment, the head of Asia forex strategy adds. USD/SGD is little changed at 1.3675. (ronnie.harui@wsj.com)

Singapore dollar slightly weakens against the greenback ahead of the U.S. CPI data release due later today. Core CPI is expected to have stayed steady at 3.3% on year in December, Maybank analysts say in a report. Analysts add that readings around this forecast is likely to keep the U.S. dollar supported. However, a report much higher than expectations could lead to a further upward move by the greenback amid "edgy" market sentiment, the analysts add. The "opposite can happen if the reading is much lower, given the heavy long dollar positions," the analysts note. USD/SGD is 0.1% higher at 1.3685. (ronnie.harui@wsj.com)

Singapore's central bank has little need to rush to ease policy, but as disinflation has made good progress, OCBC strategists think it now has that optionality. MAS can afford to begin with reducing the slope of the policy band at the upcoming meeting, due by end-January, while maintaining a mild appreciation stance. Adjusting the slope influences the pace at which SGD appreciates or depreciates on a trade-weighted basis. "While a reduction in policy slope is likely to weigh on SGD, the USD trend also matters," Christopher Wong and Frances Cheung say. The combination of USD strength, risk of shallower Fed cuts, softer CNY amid tariff concerns and milder MAS appreciation stance suggest USD/SGD may continue to trend up. The MAS status quo could see a pullback in USD/SGD. (fabiana.negrinochoa@wsj.com)

Singapore dollar is steady against its U.S. counterpart in the Asian session. However, Asia ex-Japan currencies will likely continue to face pressures from a resilient U.S. economy and looming tariff risks from the incoming Trump administration, MUFG Bank's Lloyd Chan says in a research report. Friday's non-farm payrolls data were also stronger than expected, the senior currency analyst notes. Markets have pushed back full pricing of the next 25bps rate cut by the Fed to September 2025 from mid-2025 before the data's release, the analyst adds. USD/SGD is little changed at 1.3718. (ronnie.harui@wsj.com)