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Singapore loses ground against the greenback

Bearish sentiment grows among traders.

IG Markets Singapore said:

The local currency has been very slowly but surely losing ground against the US dollar and has broken through a ceiling this morning.

The Singapore dollar pushed through the $1.225 level last night which it has remained within for November.

Bearish sentiment is growing among traders, being driven on a variety of fronts. While the US fiscal cliff is a major concern, events in Europe are also causing a few wobbles.

The eurozone has officially fallen into recession which could be the start of an elongated period of zero growth as it battles with tough government spending cuts.

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This is weighing heavily on FX traders who are thinking twice before increasing their Asian currency exposure, excluding the yen.

OCBC Treasury Research meanwhile noted:

USD-Asia looks set to remain well supported for now, given the lack of risk appetite currently seen in the market.

USD-SGD should continue to trade the 1.2200-1.2300 for the immediate future, while the USD-MYR could attempt a test to shore up above 3.0700 in the near-term.

USD-KRW, USD-PHP and USD-THB still fairly supported above the 1085, 41.00 and 30.60 respectively. Note that Indonesian markets remain closed today.



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