USD/SGD gains modestly as data, tariff concerns weigh

The USD/SGD currency pair edged higher on Wednesday, but gains were restrained by disappointing US consumer confidence data and fears over the effect of upcoming tariffs on US economic growth.

The Trump administration’s reciprocal tariffs are set to take effect on April 2nd, which many believe may stoke inflation and hinder GDP growth.

In an interview with Newsmax on Tuesday, US President Trump said he was planning to have few exemptions on tariffs, but yet, he was being more lenient than strict.

“Market is in a wait and watch mode for tariff announcements,” Mohit Komur, chief Europe economist at Jeffries, wrote in an investor note, cited by Reuters.

“Investor sentiment is already on the negative side. If tariffs are not as bad as feared, it could serve as a clearing event and be positive for risky assets.”

On the data front, US consumer confidence has dropped to a 12-year low in March, which underscored a growing unease among US citizens regarding the nation’s economic health and their personal financial outlook.

In Singapore, manufacturing output was reported to have shrunk at an annualized rate of 1.3% in February, reversing a revised down 8% growth in January. It has been the first drop since June 2024.

Up next, traders will be expecting the final estimate on US GDP growth for Q4, due out on Thursday, and US PCE inflation report, due out on Friday. Those numbers may provide more insight into the Federal Reserve’s potential course of action in regard to borrowing costs.

The USD/SGD currency pair was last up 0.16% on the day to trade at 1.3373.