NEER Marginally Firmer, CPI On Tap

The SGD NEER (per Goldman Sachs estimates) is marginally firmer today, NEER printed a cycle high on Friday before moderating gains. We are only a touch below those levels currently and sit ~0.5% below the top of the trading band, slightly more elevated compared to early Feb levels.

• USD/SGD is ~0.2% softer today, the pair continues to follow broader USD trends. Bulls faced resistance above $1.34 yesterday. The pair last prints $1.3380/90 ~0.2% firmer today.
• A close above $1.34 open up the 200-day EMA at $1.3638. Bears look to target 2023 lows at $1.3098.
• January CPI is on the wires shortly, the print emerges as a key input into the MAS meeting in April. The Bloomberg survey median looks for a 7.1% YoY, rising from 6.5%. The Core measure is estimated at 5.7%, the prior print was 5.1%. At its October meeting MAS had forecasted headline inflation at 5.5-6.5% in 2023 and Core Inflation at 3.5-4.5%.
• As we noted earlier in the week, the rise in the good and services tax from Jan 1 is a key driver of the firmer headline forecast. Underlying core pressures are still expected to remain firm though, given a tight labor market.