SGD Up as Traders not Sure in Policy Change

Singapore dollarThe Singapore dollar gained against the U.S. dollar for the second day today as the traders reduced their bets that the monetary authorities are going to use the currency depreciation to stimulate the economy.

The market participants pushed the Singapore’s dollar up before the government reports on its stimulus package in the new budget. The fight with the recession may continue without the serious depreciation of the currency as the central bank said that they won’t change their stance on the dollar during the next few months.

Analysts believe that the current withdrawal of the bets that the monetary authorities are going to depreciate the currency will help the Singapore’s dollar to stand still against the U.S. dollar. Earlier, traders built up the confidence that the depreciation will be issued before April to stimulate the economy, now they will have to wait at least until that month for something to happen.

USD/SGD went down from 1.4978 to 1.4934 as of 8:32 GMT today after reaching 1.5120 during the trading session yesterday — its lowest level in 6 weeks.