Weekly Outlook: Little Scheduled To Lift Singapore Dollar

Full Story: Slowly but surely, the Singapore dollar continued to lose ground after last weeks advance, rising from the 1.5800 support figure witnessed last week.  Consolidating in midweek action at the 1.5850 figure, the currency has now risen to test the topside resistance at 1.5900 on US dollar strength as economic fundamentals were less than expected by the consensus.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

However, this weeks batch of data should offer more hope for the <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Singapore dollar bull as key reports are likely to offer supporting evidence of a growing economy.  First and foremost, traders will key in on the industrial production report for the month of August.  Although expected to slow slightly, the economy continues to run full steam ahead, rising 19.6 percent in the month of July.  August should be a nice follow up as the consensus is expecting a rise of 12.3 percent, complimenting the current trend of positive increases in the report.  However, some pressure may be added dependant on the monthly comparison as the declines on the shorter time frame are likely to spark some short term bearishness in the interim.  Subsequent to the industrial production report will be money supply figures for the month.  Both figures are expected, at separate levels, to further suggest inflationary pressure existence as the Asia tiger continues to expand at a healthy rate.  The notion would be further confirmed by the credit card billings figure, estimated to rise once again above the 1500 million mark as consumers continue to take interest.

Comparatively, fundamental data was limited on the week with the only reports being Automobile open bids and the consumer price index.  Continuing the inflationary suggestion, the consumer price index printed an increase of 0.7 percent in the month of August.  However, the figure was a noticeable decline to the 1.1 percent seen in the previous month and gives suggestions of weakening pressures.  The lower figure additionally stands as the second decline in three months, telling of a temporary slowdown.  Additionally signaling the aforementioned are the lower number of bids for automobiles in the economy.  Granted, the report is relatively unreflective of consumer demand, the fact of the matter remains that the number of bids have trailed off, as demand for automobile licenses are likely to have declined from highs seen last month.  Subsequently, the figure is surprising given the relatively tight labor market, but expected from the previous all time high.

Economic Releases for September 26 October 3