The Singapore dollar spiked higher against the US dollar on Tuesday morning in Asia despite a report showed that Singapore's economy contracted worse than expected in the first three months of 2008. The Singapore currency surged to a 9-week high of 1.4959 against the greenback by 8:15 pm ET on Monday.
According to the Singapore Statistics Department, the nation's gross domestic product plummeted to 19.7 percent compared to the previous quarter. This was far below analyst expectations for a 9.0 percent decline following the 16.9 percent fall in the previous quarter.
On an annual basis, GDP was off 11.5 percent versus expectations for an 8.9 percent decline after the 3.7 percent contraction in the previous quarter.
As a result of the data, the Monetary Authority of Singapore lowered its GDP forecast for the year to between minus-6 to minus-9 percent. In January, the MAS had estimated a decline of between 2 and 5 percent.
The Singapore dollar has gained more than 4 percent against the buck since it reached a new multi-year low of 1.5583 on March 3rd. If the Singapore currency edged up further, resistance is seen at the 1.483 level. The pair, which closed Monday's New York trading at 1.5137, is presently worth near 1.501.
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