SINGAPORE: MAS Decision Announced On July, SGD NEER Close To Top End Of Band
Jul-22 03:28
Headlines crossed a short while ago that the next MAS policy announcement will be made on July 30th (which is next Wednesday). This decision comes after the last two policy meetings (Jan and Apr of this year), delivered modest easings to the monetary policy backdrop. These came via a reduced pace of SGD NEER appreciation, see the table below for a recent history of MAS decisions.
- The bias around this upcoming meeting may be for no changed. The worst of a potential trade conflict for the global economy hasn't materialized yet, while local Singapore economic conditions have not been as bad as feared.
- This was signified by the recent advanced Q2 GDP print, which showed better than expected growth, which also meant the economy avoided a technical recession (after Q1 growth was negative).
- Still, the MAS may be mindful of uncertainty surrounding the outlook, while inflation pressures have generally been very muted. Note tomorrow we get June inflation figures.
- Market pricing, per the deviation from the SGD NEER from the top end of the band (using the Goldman Sachs SGD NEER index) is not suggesting fresh easing, as the NEER remains close to top end of the policy band.
Table 1: Historical MAS Decision Outcomes
| Date | Slope | Width | Center |
|---|---|---|---|
| 04/14/2025 | Reduced slightly | No change | No change |
| 01/24/2025 | Reduced slightly | No change | No change |
| 10/14/2024 | No change | No change | No change |
| 07/26/2024 | No change | No change | No change |
| 04/12/2024 | No change | No change | No change |
| 01/29/2024 | No change | No change | No change |
| 10/13/2023 | No change | No change | No change |
| 04/14/2023 | No change | No change | No change |
| 10/14/2022 | No change | No change | Re-centered upwards |
| 07/14/2022 | No change | No change | Re-centered upwards |
| 04/14/2022 | Increased slightly | No change | Re-centered upwards |
| 01/25/2022 | Increased slightly | No change | No change |
| 10/14/2021 | Increased slightly | No change | No change |
| 04/14/2021 | No change | No change | No change |
| 10/14/2020 | No change | No change | No change |
| 03/30/2020 | Shifted to zero appreciation | No change | Re-centered downwards |
Source: Bloomberg Finance L.P./MNI
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USDCAD TECHS: Corrective Cycle
Jun-20 20:00
- RES 4: 1.4111 High Apr 4
- RES 3: 1.4016 High May 12 and 13 and a key resistance
- RES 2: 1.3832/1.3920 50-day EMA / High May 21
- RES 1: 1.3747 High Jun 19
- PRICE: 1.3733 @ 16:23 BST Jun 20
- SUP 1: 1.3540/3521 Low Jun 16 / 1.0% 10-dma envelope
- SUP 2: 1.3503 1.618 proj of the Feb 3 - 14 - Mar 4 price swing
- SUP 3: 1.3473 Low Oct 2 2024
- SUP 4: 1.3410 1.764 proj of the Feb 3 - 14 - Mar 4 price swing
The trend needle in USDCAD points south and this week’s recovery is considered corrective. Resistance at the 20-day EMA, at 1.3710, has been pierced. A continuation higher would signal scope for a stronger retracement and expose pivot resistance at the 50-day EMA, at 1.3832. For bears, a reversal lower and a resumption of the downtrend would pave the way for an extension towards 1.3521, envelope-based support.
LOOK AHEAD: Next Week's Key US Data Releases
Jun-20 20:00
US data is headlined by Thursday’s Q1 GDP revisions and Friday’s PCE report for May although there are plenty of other releases that will be watched with interest throughout the week.
- Q1 GDP data will be “stale”, especially being a third release, but it will nevertheless help the Fed assess whether its previous view on the economy is playing out. Recall that Powell at the May FOMC press conference said he expected consumption and inventories to have increased more strongly than first reported in the flash release. Last month’s second release showed that only partly played out, with inventories revised even higher but consumption revised down from 1.8% to 1.2%. Nevertheless, Powell at Wednesday’s June FOMC press conference still described the downward revised 2.5% for PDFP as “solid”.
- The May PCE report should be more impactful for clues on latest consumer momentum amidst strong income growth. Retail sales saw the largest monthly drop since March 2023 although the closely-watched control group was stronger than expected. As for inflation metrics, core PCE is seen around 0.15% M/M in May judging by unrounded estimates after the usual CPI, PPI and import price inputs, after 0.12% M/M in April.
- As for the other releases to watch, Monday’s preliminary June PMIs will give timely updates on wider activity after Empire and Philly Fed manufacturing surveys remained in contractionary territory. We also expect greater than usual focus on housing data (existing home sales Mon, new home sales Wed) after what have been some troubling releases across both construction and sentiment. Tuesday then sees the Conference Board consumer survey for an alternative look at the improvement since the de-escalation in trade policy before Wednesday’s advance trade data for the latest post tariff front-running update.
US TSYS: Tsys Narrow/Higher Range, Trump Been "Speaking to Iran"
Jun-20 19:53
- Treasuries look to finish higher Friday, top half of narrow range. Early risk-on tone followed unscheduled comments from Fed Governor Waller on the possibility of a rate cut in July and headlines that Iran was ready to discuss limitations on uranium enrichment plans.
- No market reaction to late Pres Trump comments to reporters & social media posts: "WILL MAKE TRADE DEAL WITH INDIA, PAKISTAN," "BEEN SPEAKING TO IRAN," "IRAN WANTS TO SPEAK TO US, NOT EUROPE" - Bbg posts. Trump adds Europe is not going to help with Iran, nor will China; Trump "might" support Israel/Iran ceasefire
- The price details of the Philly Fed manufacturing survey for June showed a pullback from elevated rates for both prices paid and prices received in the current period. Six-month ahead expectations for prices paid pushed higher again though, and at 68.9 is getting closer to the high of 77.8 from Jan 2022, although prices received isn’t quite as relatively elevated.
- Tsy Sep'25 10Y futures trades +5 at 110-30.5 vs. 111-03 high, remains below key resistance and its recent high of 111-14+, a Fibonacci retracement and the Jun 5 high. Clearance of this hurdle would be bullish and highlight a stronger reversal. This would open 111-30, a Fibonacci retracement.
- Curves steeper, 2s10s +2.611 at 47.137, 5s30s +3.530 at 93.143. 10Y yield at 4.3791% vs. 4.3593% low. Projected rate cut pricing back to 50bp by December.
- Cross asset: Stocks mixed (DJIA +29.34 at 42,202.0, SPX eminis -20.75 at 6013.5), Gold mildly lower at 3365.05, Bbg US$ index little firmer at 1210.80 +1.10.
