Expected Exchange Rate of SGD1.00 with Other Currencies via Interest Rate Parity Theory.
In the Table above, IR stands for the interest rate of the country as set by Central Bank or Monetary Authority. The Table shows that SGD is not either significantly over or undervalued, and the Governments 'control' of the SGD is just about right. The currency to watch out for is the JPY. Japan's current economy is fragile. With a Debt/GDP ratio of 260%, rising inflation and the impact of Trump's trade tariffs on Jaoanese automobiles and steel yet to be felt, we may see the Yen extend its downard trend. Add to that, yesterday's Upper House elections in which Ishiba's LDP coalistion performed badly, we may see the conservative, nationalistic and right-wing faction of Japanese politics extend its influence on foreign and domestic policies and create an environment of insatbility-all to the detriment of the JPY. The SGD/JPY chart below shows that JPY may cross below its 10-year low. Calculating the intrinsic value of a currency is complex because currencies ar...