SGD: A Bump In The Bull Run

Even with its mammoth external surpluses, the Singapore dollar has come a long way against the greenback in 2011, and a corrective period looks in order. We would not be surprised to see the unit retrace back towards SGD1.2300/US$ in the first instance, as concerns over a renewed global downturn intensify. In the event of a sustained dollar comeback, we would expect to see SGD outperform against the likes of NZD, AUD and KRW given our preference for the currency as a regional safe haven.

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