SGD likely to trade at 1.48 by end-2017, says ANZ Research

The Singaporean dollar is expected to trade at around 1.47 by the end of this year, according to a forecast publish by ANZ Research, revising from 1.50 previously.

The previous forecast had factored in further policy easing by the Monetary Authority of Singapore (MAS) via a re-centring of the policy band. But with economic indicators showing an improvement in growth and inflation back in positive territory after a long period of deflation, there seem very low odds of further easing by MAS, the report said.

The SGD NEER has risen this year, partly on the back of the weaker USD and partly as the market removed any prospects for near-term policy easing.

"Though we do not foresee a re-centring lower, we think the SGD NEER should more naturally be trading closer to the midpoint. With the Singapore economy still undergoing restructuring and potential growth remaining low, this should ultimately be reflected in a weaker SGD," the report commented.