Singapore Dollar Strengthens Amid Risk-On Sentiment

Most Asian currencies are strengthening against the USD in response to Wall Street’s gains. The positive sentiment is attributed to the rally in U.S. equity markets. Analysts suggest that the USD Index may edge lower if the U.S. inflation reading later today eases, but it could rebound due to adjustments in Fed rate-cut expectations. The USD/SGD is down 0.2% at 1.3295. In the morning session, Asian currencies also strengthened against the dollar, driven by the risk-on sentiment from Wall Street’s gains. Market participants are awaiting the U.S. December CPI data, with expectations of a smaller increase in core CPI. If the outcome is softer than expected, it could lead to increased expectations for FOMC rate cuts and weigh on the USD. The USD/KRW fell 0.2% to 1,316.39, while the USD/SGD declined 0.1% to 1.3301.