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Currency Market Analysis

Sep 26, 2017 | Currency Market Analysis

Global Themes

USDSGD nears monthly highs on North Korea worries

The rising tensions between the US and North Korea sent financial markets lower overnight and the USDSGD gained as a result.

Sharemarkets across the globe were lower with the US’s Nasdaq index down 1.1% after North Korea’s foreign minister said recent US commentary was a “declaration of war”.

The USDSGD climbed 0.4% as it returned to the September highs.

Mostly weaker

The SGD was mixed in other markets.

The SGD jumped higher versus the euro after the European currency fell on the German election result, North Korea worries and an overnight speech from European Central Bank head Mario Draghi who said any withdrawal of stimulus would be gradual.

The SGD was weaker versus the British pound, Swiss franc and Japanese yen.

In particular, the JPY jumped from 18-month lows in a significant technical reversal.

Yellen speaks

Tonight’s focus is on a major speech from US Federal Reserve chair Janet Yellen.

Yellen speaks on the hottest topic in financial markets: “Inflation, uncertainty and monetary policy.” The speech could drive further USDSGD gains.

Otherwise, the US remains in focus, with third-in-charge at the Fed Lael Brainard also speaking and US consumer confidence due.

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