Singapore will appreciate currency

In continuing with this week’s unofficial theme of Asia on the forex blog, I have chosen to cast a spotlight on Singapore’s currency, the Dollar, which typically receives scant coverage. Singapore pegs its Dollar to a basket of currencies, allowing it to fluctuate tightly within a carefully managed range. In fact, Singapore has been known to adjust the relative value of its currency-rather than interest rate levels- as a means of conducting monetary policy. Towards this end, it recently announced that it would induce its currency to appreciate, in order to combat domestic inflation. Bloomberg News reports:

Singapore's policy contrasts with Thailand and South Korea, who are seeking to stem currency gains to protect exporters. Stronger currencies may cut demand for goods sent overseas as they increase costs to buyers based abroad.

Read More: Singapore will manage currency, bank says