Singapore Dollar Weakens Against U.S.Dollar Despite Inflation Data

 
                       Latest   Change 
 USD/SGD               1.3668   +0.0039 
 Overnight Rate        0.25%    +12 bps 
 2-Year Bond Yield     0.96%    +3 bps 
 10-Year Bond Yield    2.67%    +2 bps 
 2-Year Swap Offer     1.47%    +2 bps 
 10-Year Swap Offer    2.83%    Unchanged 
 2-10-Year Swap Curve  136 bps  -2 bps 
 

        SINGAPORE--The Singapore dollar weakened against the U.S. dollar Thursday, despite inflation data in Singapore that analysts said makes monetary policy easing less likely later this year.
        The U.S. dollar was trading at 1.3668 Singapore dollars near the end of the Asian trading session, compared with S$1.3629 around the same time Wednesday. Its strength--and the Singapore dollar's implied weakness--was likely more a function of a broadly stronger U.S. dollar against many other Asian currencies than it was a reflection of domestic factors.
        Yet it was local news that investors were watching closely. Consumer prices fell again in June, indicating that deflation is entrenched in Singapore. But analysts said the figures were unlikely to lead to further policy easing at the Monetary Authority of Singapore when it is next scheduled to review policy in October.
        "No big surprises in June," HSBC said in a note. "MAS is likely to look through this short-term noise. The central bank believes inflationary pressures from the tight labor market will materialize in 2016, and is therefore unlikely to alter policy settings for the rest of 2015 barring any significant changes to the growth or inflation outlook."
        Singapore government bond yields rose slightly, with the two-year yield up 0.03 percentage point to 0.96% and the longer-dated benchmark 10-year yield up 0.02 percentage point at 2.67%. Yields move inversely to prices.
        Write to Jake Maxwell Watts at jake.watts@wsj.com
        (END) Dow Jones Newswires

        July 23, 2015 05:44 ET (09:44 GMT)

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