SINGAPORE, Feb 25 (Reuters) - The Singapore dollar fell slightly on Monday after the city-state reported a slower-than-expected inflation rate in January.
The local currency weakened 0.2 percent to 1.2393 to the U.S. dollar as at 0529 GMT after consumer prices in January rose 3.6 percent from a year earlier, below a forecast of a 4.0 percent rise.
Before the data, the Singapore dollar stood at 1.2391.
"The Singapore dollar may weaken more if the yen falls further and the euro drops," said a senior Asian bank trader.
"It is possible to see 1.2410. But no more than that," said the trader, noting that other emerging Asian currencies haven't fallen much on the day.
The Singapore dollar has a 200-day moving average at 1.2408. Once that level is broken again, it may weaken to 1.2465, the 38.2 percent Fibonacci retracement of its appreciation between June and October, according to analysts.
On Feb 21, it closed weaker than the average for the first time since June.
Earlier on Monday, it hit 1.2407 to the U.S. dollar and threatened to go past the average.
On Friday, stronger-than-expected growth data helped the city-state's currency enjoy a 0.4 percent gain against the greenback, its largest daily percentage appreciation since Jan. 10, according to Thomson Reuters data.
The Singapore dollar has lost 1.4 percent against the U.S. dollar so far this year on worries about a slowing local economy and caution over central bank intervention. (Reporting by Jongwoo Cheon; Editing by Shri Navaratnam)
