'Modest appreciation' of SGD against USD expected as MAS tightens monetary policy

CURRENCY analysts are expecting a "modest appreciation" of the Singapore dollar (SGD) against the US dollar (USD), following an off-cycle tightening of policy by the Monetary Authority of Singapore (MAS) on Tuesday (Jan 25) - ahead of its scheduled meeting in April.

The move comes after higher-than-expected inflation figures released on Jan 24, with Singapore's headline inflation exceeding economists' expectations to rise 4 per cent in December.

"An off-cycle move is always a surprise," said Bank of Singapore currency strategist Sim Moh Siong. "(But) the slight tightening now will help avoid the situation where MAS needs to do a lot more later on."