The Singapore dollar (SGD) is considered to be an exotic currency in the Forex market.
The first thing you need to know about the Singapore dollar is that it is pegged within a tight trading band to an undisclosed basket of currencies. The basket is believed to be made up of currencies from the country’s top trading partners, but nobody knows for sure which ones are included and what the weighting of each is.
Singapore is the world’s fortieth largest economy.
Trade Surplus or a Trade Deficit
Singapore runs a trade surplus of $40.44 billion, giving the country a ranking of 9 out of the 190 countries tracked by the CIA in The World Factbook.
What Does Your Economy Export?
Singapore exports machinery and equipment (including electronics), consumer goods, pharmaceuticals, other chemicals, and mineral fuels.
According to the World Trade Organization (WTO) ( stat.wto.org), Singapore exports $269.8 billion in goods and merchandise compared to only $87.8 billion in commercial services. The WTO breaks down those exports as follows:
Goods and Merchandise
- Agricultural products: 2.3 percent
- Fuels and mining products: 16.3 percent
- Manufactures: 73.2 percent
Commercial Services
- Transportation: 35.0 percent
- Travel: 10.5 percent
- Other commercial services: 54.6 percent
To Whom Does Your Economy Export?
The WTO ranks the following countries as the top destinations for exports from Singapore:
- Hong Kong: 11.6 percent
- Malaysia: 11.5 percent
- China: 9.7 percent
- Indonesia: 9.7 percent
- European Union: 9.6 percent
What Does Your Economy Import?
Singapore imports machinery and equipment, mineral fuels, chemicals, foodstuffs, and consumer goods.
According to the WTO, the country imports $245.8 billion in goods and merchandise compared to only $81.4 billion in commercial services. The WTO breaks down those imports as follows:
Goods and Merchandise
- Agricultural products: 3.6 percent
- Fuels and mining products: 26.3 percent
- Manufactures: 66.1 percent
Commercial Services
- Transportation: 32.5 percent
- Travel: 19.4 percent
- Other commercial services: 48.1 percent
From Whom Does Your Economy Import?
The WTO ranks the following countries as the top sources of imports to Singapore:
- European Union: 13.8 percent
- United States: 11.9 percent
- Malaysia: 11.6 percent
- China: 10.5 percent
- Japan: 7.6 percent
Do You Have an Attractive Government Debt Market?
Singapore currently has a Moody’s rating of Aaa. It received this latest rating on June 14, 2002. This most recent rating was an upgrade from the Aa1 rating that the country had held previously. This is a positive sign for the country’s government debt market.
Do You Have an Attractive Equities Market?
Singapore has an attractive equities market, but it is not very large. It is the twenty-second largest equities market in the world, with a total market value of $474.8 billion.
Central Bank Mandate
The Monetary Authority of Singapore is charged with maintaining price stability. The Monetary Authority of Singapore has foreign currency reserves of $222,694 million and gold deposits of $212 million.
Government Intervention in Forex
The Monetary Authority of Singapore is charged with maintaining price stability. The Monetary Authority of Singapore has foreign currency reserves of $222,694 million and gold deposits of $212 million.
Important Economic Announcements
When you are watching the economic announcements coming out of Singapore, make sure that you keep your eye on the following:
- Interest rates
- Employment
- Inflation
- Gross domestic product (GDP)
- Trade balance
Are You a Safe-Haven Currency?
No, the Singapore dollar is not considered to be a safe-haven currency.
How Can I Trade You?
You can trade the Singapore dollar using the following:
- Spot Forex