Billions of reserves being used to prop up weak SGD

[BuiKia]

https://sg.finance.yahoo.com/news/bi...042600873.html

Reserves have fallen by US$34bn since July.
Singapore is spending billions of reserves to prop up its currency, a report by DBS revealed.

According to DBS, Singapore's reserves have fallen by US$34 billion since July, a trade-off of keeping the SGD on its appreciation path.
"In six short months, reserves have fallen by the equvialent of 11% of a full year's GDP. Little wonder the central bank eased back on the appreciation path in late-January, Further easing will be necessary if reserves don't stop falling," the report stated.

Singapore is not alone in using reserves to keep the currency strong. China's reserves have fallen by US$150b, causing the yuan to barely fall against the dollar. Meanwhile, Thailand, Malaysia, the Philippines and Taiwan have all spent the equivalent of 1%-4% of a full year's GDP just over the past six months supporting exchange rates.

 

[shiokalingam]

why Govt want a strong S$ ???

 

[shiokalingam]

who were the short sellers ?

 

[Cerebral]

why Govt want a strong S$ ???

To prevent a very bad inflation.

 

[frenchbriefs]

why Govt want a strong S$ ???

Keep profits up and stop sinkies from Zhao lor.lucky I got a basket of us stocks and Australian currency in case I ever need yo run road.

 

[yahoo55]

https://sg.finance.yahoo.com/news/bi...042600873.html

Reserves have fallen by US$34bn since July.
Singapore is spending billions of reserves to prop up its currency, a report by DBS revealed.

According to DBS, Singapore's reserves have fallen by US$34 billion since July, a trade-off of keeping the SGD on its appreciation path.
"In six short months, reserves have fallen by the equvialent of 11% of a full year's GDP. Little wonder the central bank eased back on the appreciation path in late-January, Further easing will be necessary if reserves don't stop falling," the report stated.

Singapore is not alone in using reserves to keep the currency strong. China's reserves have fallen by US$150b, causing the yuan to barely fall against the dollar. Meanwhile, Thailand, Malaysia, the Philippines and Taiwan have all spent the equivalent of 1%-4% of a full year's GDP just over the past six months supporting exchange rates.

US$34bn spent to prop up SGD for six months, that's US$10,000 per citizen gone with the wind.

Too costly to fight the USD, it's simply wasting our reserves, MAS will need to ease again and it looks like they have, USD now back up to 1.392 yesterday, 3-month Sibor rise to 0.907 http://www.abs.org.sg/rates_sibor.php

We could see USD go up to 1.44 SGD and Sibor at around 1.3% within next six months.

 

[shiokalingam]

someone is buying ?

 

[Seee3]

https://sg.finance.yahoo.com/news/bi...042600873.html.

According to DBS, Singapore's reserves have fallen by US$34 billion since July, a trade-off of keeping the SGD on its appreciation path.
"In six short months, reserves have fallen by the equvialent of 11% of a full year's GDP. Little wonder the central bank eased back on the appreciation path in late-January, Further easing will be necessary if reserves don't stop falling," the report stated.

I think the report means that by keeping the sgd strong, our reserves that are parked in other currency other than USD will depreciate in value. The total depreciation of our reserves in other currencies amounted to US$34billion, leaving the govt no choice but to let the SGD to depreciate against the USD just like most other currencies. We can only maybe conclude that a great proportion of our reserve is not in USD. So buy the wrong horse again.

 

[The_Hypocrite]

If USD goes up,,it might not be a good thing for the USA economy,,,,to prop any other currency up is just a waste of $$,,,,

 

[The_Hypocrite]

No country have reserves solely in USD,,its a basket of currencies and gold reserves as well,,,with USD up, commodities etc will drop,,its all common economic stuff,, and who can predict if usd goes up or down?

I think the report means that by keeping the sgd strong, our reserves that are parked in other currency other than USD will depreciate in value. The total depreciation of our reserves in other currencies amounted to US$34billion, leaving the govt no choice but to let the SGD to depreciate against the USD just like most other currencies. We can only maybe conclude that a great proportion of our reserve is not in USD. So buy the wrong horse again.

 

[GOD IS MY DOG]

why Govt want a strong S$ ???

get rich people put money here..............attract foreigners work here............mostly becoz to keep wages low..........cost of living very high.......wages low............and we import all of our food and other stuff.......

if SGD weak............PAP voted out long ago liao...........

 

[Seee3]

No country have reserves solely in USD,,its a basket of currencies and gold reserves as well,,,with USD up, commodities etc will drop,,its all common economic stuff,, and who can predict if usd goes up or down?

"Cycle" should be a natural process. The period and amplitude of the cycle may change but not the up / down pattern of the cycle. After the 2008 crisis, the lowest value of usd was about 1 USD to 1.18 SGD. This is not much different from previous low. Each cycle is about 10 years plus. So it is not surprising that USD starts picking up after about 6 years. What caught the govt off-guard was the way and speed that usd appreciate - through the depreciation of oil prices by a drop of 50% in just a few weeks. No chance to change their basket of currencies. It proves that our top guys also have no access to information like the depressing of oil price, QE policy by Jap to depress Yen ... all working towards the direction of appreciating USD. I stop believing in economic theory. Now I only believe that even cycles are man made and they are triggered so that the rich can become richer. ..

 

[SgGoneWrong]

Reserve used to prop up sg currency so that ministars will not have their dignity compromised?

 

[eatshitndie]

"Cycle" should be a natural process. The period and amplitude of the cycle may change but not the up / down pattern of the cycle. After the 2008 crisis, the lowest value of usd was about 1 USD to 1.18 SGD. This is not much different from previous low. Each cycle is about 10 years plus. So it is not surprising that USD starts picking up after about 6 years. What caught the govt off-guard was the way and speed that usd appreciate - through the depreciation of oil prices by a drop of 50% in just a few weeks. No chance to change their basket of currencies. It proves that our top guys also have no access to information like the depressing of oil price, QE policy by Jap to depress Yen ... all working towards the direction of appreciating USD. I stop believing in economic theory. Now I only believe that even cycles are man made and they are triggered so that the rich can become richer. ..

it should be no mystery nor rocket science for economic masterminds of sg to see the trend and predict outcomes based on u.s. economic indicators. clearly, recovery was in 2010 through 2013, and now we're in the "expansion" phase of the cycle with some years to go before the next downward trend. the sharp decline in 2008 was massive and unprecedented mainly due to bad loans and the housing bust (all self-inflicted due to poor financial and banking policies and policing), but the ensuing recessionary, recovery and expansion phases should not come as a surprise as qe was maintained as an effect of continued deflationary pressure. and then, the tech boom and discovery of shale oil, use of frackng to extract fuel, and the boom in production and self-sufficiency in energy needs. that sped up confidence and economic expansion. sg think tanks should have figured that out in 2014 when i posted about windows of opportunities closing in the emigration folder. it was about real estate in the bay area, but that was disguised as salad dressing for the larger buffet spread. this chart has always been available online.

 

[Cerebral]

I think the report means that by keeping the sgd strong, our reserves that are parked in other currency other than USD will depreciate in value. The total depreciation of our reserves in other currencies amounted to US$34billion, leaving the govt no choice but to let the SGD to depreciate against the USD just like most other currencies. We can only maybe conclude that a great proportion of our reserve is not in USD. So buy the wrong horse again.

Probably Euros. That's about the only thing falling

 

[eatshitndie]

Probably Euros. That's about the only thing falling

and japanese yen, aussie dollar, canadian dollar.

 

[CoffeeAhSoh]

US$34bn spent to prop up SGD for six months, that's US$10,000 per citizen gone with the wind.

Too costly to fight the USD, it's simply wasting our reserves, MAS will need to ease again and it looks like they have, USD now back up to 1.392 yesterday, 3-month Sibor rise to 0.907 http://www.abs.org.sg/rates_sibor.php

We could see USD go up to 1.44 SGD and Sibor at around 1.3% within next six months.

open Forex account must put how much

deposit to trade ???


i also want.


put money take money.

 

[sleaguepunter]

Weak SGD is damaging to sing economy. With SGD weaken, then it no longer attractive foe foreigners to come here to work. SGD already depreciated against renminbi more than 10% in the last ten years. It no longer attractive for coastal ah Tiong to come, current ah Tiong are from the hinterland.

SGD weak also mean less $$ for angmo Ftrash too. Angmo leave mean less $$ for the service and retail industry, which mean jobs losses in this industry, chain reaction will be rental yield drop and Reits cannot generate enough revenue to pay shareholders. Economy will turn recessionary.

But to let SGD depreciate, mean interest rate will go up and property sector will take the hit. If confidence gone, property price will plunge and many 99 yrs condo owners will suffer negative asset with banks chasing them to top up difference and rising loan interest rate.

It will be an interesting 2015.

 

[Boliao]

Weak SGD is damaging to sing economy. With SGD weaken, then it no longer attractive foe foreigners to come here to work. SGD already depreciated against renminbi more than 10% in the last ten years. It no longer attractive for coastal ah Tiong to come, current ah Tiong are from the hinterland.

SGD weak also mean less $$ for angmo Ftrash too. Angmo leave mean less $$ for the service and retail industry, which mean jobs losses in this industry, chain reaction will be rental yield drop and Reits cannot generate enough revenue to pay shareholders. Economy will turn recessionary.

But to let SGD depreciate, mean interest rate will go up and property sector will take the hit. If confidence gone, property price will plunge and many 99 yrs condo owners will suffer negative asset with banks chasing them to top up difference and rising loan interest rate.

It will be an interesting 2015.

Your logic is so wrong it's very funny. I hope you're being sarcastic as it seems quite ludicrous for someone to get this in the complete opposite.

1. If SGD is weak, things here becomes cheaper for foreigners and tourist, not more expensive. FT in Singapore are mostly paid in their currency back home unless they are taking a local package. More Singaporeans are now buying in Malaysia because our dollar has appreciate significantly against ringgit. Ah Tiongs are not coming because they can get it cheaper in China and they no longer have to go overseas for luxury goods.

2. A strong SGD means our imports (other than US) is cheaper. The retail industry benefits as Singapore has more spending power (assuming inflation doesn't keep up). I don't even know how to response to you linkage to rental and shareholder. This is like saying my dog will eat more now that SGD is stronger.

3. You're right that interest rate and currency are highly co-related but a higher interested rate means a stronger dollar. Just look at 3-month SIBOR going up as SGD appreciates.

 

[sleaguepunter]

FTrash paid in their home currency? Top management maybe, the rest on local package lah. Btw, spore export shit nowsaday with every raw materials imported in either USD or other currencies. It cost more to import liao. Even coca cola import coke from Malaysia for Singapore market despite having a bottling plant at Tuas.

Higher interest mean strong currency is a myth. Zimbabwe interest very high but u want to hold a deposit there.

Don't believe it ok. Just an exchange of ideas.