While the relentless greenback strength has clobbered Asian currencies this year, Singapore’s dollar has held up relatively well thanks to a hawkish central bank and recovering economic growth. The currency has weakened 3.8% against the dollar in 2022, but has strengthened against all of its Asian peers with the exception of the Hong Kong dollar.
Singapore’s dollar is emerging as the top bet for Wall Street’s biggest banks as wagers the central bank will extend policy tightening bolsters demand for Southeast Asia’s top-performing currency.
Goldman Sachs Group Inc. favours the Singapore dollar the most among Asian currencies, along with Thailand’s baht. Citigroup Inc. recommends buying the currency on dips, while RBC Capital Markets says further policy tightening by the Monetary Authority of Singapore – which uses the nation’s foreign exchange as its main policy tool – will only turbocharge its gains.
