SINGAPORE, Feb 27, 2008 (AFP) – The Singapore dollar climbed on Wednesday to a fresh 11-year high against the US dollar which also slid against other regional currencies following weak US economic data, dealers said. Details of the trading band are not made public to prevent speculation in the Singapore dollar. They said Asian currencies gained as players bet on further Federal Reserve interest rate cuts to try to ward off the threat of recession in the world’s largest economy.
In afternoon trade the Singapore unit was at 1.3997 after touching a high of 1.3993, and compared with 1.4049 on Tuesday.
Vishnu Varathan, a currency analyst at Forecast, said he expects the Monetary Authority of Singapore (MAS), the de facto central bank, to maintain its policy of allowing the gradual and modest appreciation of the Singapore dollar.
MAS is to issue its semi-annual monetary policy statement in April.
“There is no basis to loosen the policy given the high inflation. There is also no basis to tighten it given the downside risks for the economy,” he said.
Last October the MAS signalled a slight tightening of its policy in the face of rising inflation. Inflation has surged even higher since then. It reached an