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Currency Market Analysis

Sep 27, 2018 | Currency Market Analysis

Global Themes

USD climbs from lows as Fed signals end to “accommodation”

The USDSGD neared one-month lows overnight as the US Federal Reserve announced a widely-expected interest rate hike.

The US Fed raised rates to a new band between 2.00% and 2.25% -- the highest since 2008.

However, at the post-decision press conference, Fed chairman Jerome Powell boosted the US dollar by signalling he expects to continue to raise rates at a steady pace.

Importantly, the removal of the word “accommodative” and Powell statement that the Fed might push rates beyond neutral – whatever “neutral” is – was seen as a positive for the USDSGD.


The rebounded from early losses to end the session down 0.1%.

Other key currencies were lower with the EURSGD down 0.3% and the GBPSGD down 0.1%.

The NZD climbed 0.1% after the Reserve Bank of New Zealand kept interest rates on hold at this morning’s policy decision.

USD focus

The US dollar will remain in focus tonight with US second-quarter growth figures due at 8.30pm

The market expects US growth to come in at a very strong 4.2% in annual terms.

The US durable goods orders – a more up-to-date reading of the US economy – will also be closely watched.

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