A combination of returning capital inflows and high inflation is likely to push the value of the Singapore dollar up in the months ahead, analysts said.
This is because most analysts believe that when the central bank meets later this month to set the exchange rate policy, the Monetary Authority of Singapore (MAS) will continue to allow the Singdollar to appreciate.
One key reason is that inflows seem to have returned to Asia with a vengeance, after fleeing the region from the middle of last year.
DBS head of economic and currency research David Carbon noted that the amount of foreign reserves held by the eight major Asian economies, excluding China and India, is now around US$1.925 trillion (S$2.4 trillion).
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