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USD falls to near 4-month low against SGD

SINGAPORE — The US dollar fell to a near 4-month low against the Sing dollar today (Feb 11), trading at US$1 to S$1.3861 at 9.15am (Singapore time), showed Bloomberg data.

Reuters file photo

Reuters file photo

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SINGAPORE — The US dollar fell to a near 4-month low against the Sing dollar today (Feb 11), trading at US$1 to S$1.3861 at 9.15am (Singapore time), showed Bloomberg data.

At 4.25pm today, the USD had risen again against the Sing dollar to S$1.3902. The last time the USD was around the S$1.386 mark was on Oct 16 last year.

Fresh cracks appeared in global markets today as investors sought the safety of Japanese yen, gold and top-rated bonds while dumping US dollars.

The US dollar hit a 15-month low against the yen after comments from Federal Reserve Chair Janet Yellen gave investors no reason to change their minds that the next rate hike will be a long time coming.

Sticking largely to the script, Ms Yellen made clear yesterday that the central bank remained on a path of ‘gradual’ policy tightening. Yet, she also highlighted growing risks facing the economy.

That gave currency investors the green light to continue the current trading theme — buy the safe-haven yen.

“The idea that you will be okay if you buy the dollar since the United States alone will be raising interest rates, is becoming difficult to justify,” Mr Satoshi Okagawa, senior global markets analyst for Sumitomo Mitsui Banking Corporation in Singapore, told Reuters.

The greenback also hit a three-and-a-half-month low against a basket of six major currencies. The dollar index touched a trough of 95.508 at one point, its lowest level since Oct 22, and was last trading at 95.749.

That low for the dollar index marked a drop of nearly 5 per cent from its 12-and-a-half-year peak set in early December when the consensus was for the Fed to keep raising interest rates this year.

Ms Yellen told US lawmakers yesterday that the Fed was unlikely to reverse its plan to raise interest rates further this year. She added, however, that tighter credit markets, volatile financial markets, and uncertainty over Chinese economic growth had raised risks to the US economy.

“While the Fed is in a waiting mode to see how those risks play out, we don’t see Fed hikes being priced in again any time soon,” analysts at BNP Paribas wrote in a note to clients.

“In this environment USD is likely to continue to struggle against the G10 funders JPY and EUR, although we would also be wary of calling for significant dollar weakness against these currencies as we think the BOJ and ECB will remain sensitive to FX appreciation.”

The moves in currencies came in holiday-thinned trade, with markets in Japan and China shut for public holidays. AGENCIES

 

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