In the past month, USDSGD hit a low of 1.5092 on April 19th and a high of 1.5282 on May 2nd. USDSGD closed on Friday, May 4th at 1.5176.
This is an opportunity to switch out of your USD before the long term trend resumes towards the imminent target of 1.48.
We have attached both the hourly chart and also the weekly chart. The hourly chart shows the temporary recovery of the USD, and clearly showing the lack of follow through. The weekly chart reinforces the long term downward trend of the USD against the SGD.
The slight resurgence of the USD is due to the recent economic data that suggests that the US economy may be getting out of its stagflation with little risk to a recession. This can only be confirmed with incoming data in the next few months.
We are of the opinion that the situation in the U.S. will get worse before it gets better. In other words, we will see more deterioration till Q4, where we expect to see an economic turnaround which will take up more steam going into 2008.
The FX market moves on relativity, in this regard, the USDSGD is doomed to continue its southward journey through time. Why? Simply, if we are to compare the economic growth in Singapore to the lack of economic growth in the U.S., it is easy to understand why the exchange rate will continue to lose ground. Even, by year end when the U.S. begins to turnaround and into 2008, Singapore will still be ahead in growth numbers. Let’s not forget, both economies are considered developed and matured economies today. The future of Singapore continues to be bright, more importantly; we are creating considerable economic value adding in our own country without the need or help from the U.S.
We will shortly be coming out with an interesting USDSGD solution for investors who are holding USD but would prefer to have SGD.
This is an opportunity to switch out of your USD before the long term trend resumes towards the imminent target of 1.48.
We have attached both the hourly chart and also the weekly chart. The hourly chart shows the temporary recovery of the USD, and clearly showing the lack of follow through. The weekly chart reinforces the long term downward trend of the USD against the SGD.
The slight resurgence of the USD is due to the recent economic data that suggests that the US economy may be getting out of its stagflation with little risk to a recession. This can only be confirmed with incoming data in the next few months.
We are of the opinion that the situation in the U.S. will get worse before it gets better. In other words, we will see more deterioration till Q4, where we expect to see an economic turnaround which will take up more steam going into 2008.
The FX market moves on relativity, in this regard, the USDSGD is doomed to continue its southward journey through time. Why? Simply, if we are to compare the economic growth in Singapore to the lack of economic growth in the U.S., it is easy to understand why the exchange rate will continue to lose ground. Even, by year end when the U.S. begins to turnaround and into 2008, Singapore will still be ahead in growth numbers. Let’s not forget, both economies are considered developed and matured economies today. The future of Singapore continues to be bright, more importantly; we are creating considerable economic value adding in our own country without the need or help from the U.S.
We will shortly be coming out with an interesting USDSGD solution for investors who are holding USD but would prefer to have SGD.
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