Singapore Dollar Weakens In Risk Off Trade Despite Robust Data

Singapore dollar is weaker, suppressed by the bid in USD and general risk off tone in Asia – though equity markets are now off their lows.

• USD/SGD is just below session highs, last up 29 pips at 1.3318 having taken out yesterday's high at 1.3316 earlier in the session. Implied volatility in the pair has risen across the curve again, 1-month up 0.24 at 4.445
• Data just released showed Singapore's December resident unemployment rate was 4.4%, down from 4.6% in November. The pick up in employment was attributed to higher business activity.
• Earlier in the week markets digested industrial production data, the figures showed manufacturing rose 14.3% in December, above estimates of 12.0%. OCBC Bank expects the rate to moderate in coming months on less favourable base effects, but should remain strong medium term. In a note the bank says medium-term potential for Singapore's manufacturing sector remains bright given that 2020 fixed asset investments were very strong at $17.2b and the Manufacturing 2030 vision is targeting 50% growth in the sector's value over the next decade
• Markets look ahead to bank loans/money supply data tomorrow.