Analysts split on US debt talks’ impact on US dollar; ‘no deal’ could have unprecedented effects

AS THE US debt ceiling talks edge towards the so-called “X-date” of Jun 1, foreign exchange analysts expect that continued uncertainty without a deal could mean a strengthening of the US dollar and weakening of the Singapore dollar in the near term.

Swissquote Bank senior analyst Ipek Ozkardeskaya said in a note on Monday (May 22): “The safe-haven demand due to the debt-ceiling saga is one of the reasons why the US dollar saw inflows over the past couple of weeks.”

Meanwhile, the US dollar/Singapore dollar pair is near the top end of its two-month range.