The Singapore dollar, often ranked as one of Asia’s best-performing currencies, has continued to grow in strength over the past year, analysts said, trading at record highs against global counterparts like the Japanese yen and US dollar.
“The Singapore dollar has held firm and maintained its strength against other currencies in the region, also gaining on the weakening US dollar,” said Jeff Ng, director and Head of Asia Macro Strategy at Sumitomo Mitsui Banking Corporation.
In contrast, the Chinese yuan “saw more stability” despite appreciating in value against the US dollar, Ng said.
“What we have noticed is the Singdollar strengthening against a weakening US dollar, with the yuan remaining stable,” Ng said.
“In a way, this reflects that the Singdollar has (continued to) strengthen over the past three months while the yuan has underperformed.”
Strong fundamentals, like Singapore’s safe haven appeal, robust economic growth and easing of monetary policies, have aided the Singdollar’s stability and growth, he added.
Its rise against the yuan began in early April, said Sim Moh Siong, commodities strategist from the Bank of Singapore, adding that it also reflects the weakening of the US dollar due to its trade tariff escalations.
“This weakness has led to the current highs (we are seeing) between the Singapore dollar and Chinese yuan, with the Singdollar appreciating more than the yuan against the greenback,” he told CNA.
