- China’s sudden devaluation of the yuan caught our attention but the fate of the Singapore dollar is still in the hands of the MAS. The MAS has the tools to strengthen our dollar against the major currencies if it wants to.
- Singapore’s economy shrank by 4% in Q2/2015 due to the SGD’s strength against most of our major export markets which is led by China, Malaysia, Hong Kong, Indonesia, Europe and US.
- In two days of devaluation, the People’s Bank of China wiped out the Singapore dollar’s relative weakness against the yuan that the MAS engineered for Q3/2015. However the MAS cannot simply follow the China’s move to regain that export edge.
- While a weaker SGD would stimulate our exports, it also means higher interest rates for homeowners when the U.S. Fed is poised to raise interest rates. The recent Chinese devaluation weakened the SGD and caused the 3-month …
How China’s Drastic Yuan Devaluation Affects You in Singapore