US-India trade agreement shakes up USD/JPY exchange rate in Singapore time

In Singapore’s foreign exchange market, signs of volatility are emerging against the backdrop of recent geopolitical risk mitigation. Improvements in trade relations between the United States and India are having a positive ripple effect on financial markets across Asia, including Singapore time. This impact is particularly evident in the currency pair of the US dollar and the Singapore dollar.

Lower tariffs through trade agreements drive risk asset purchases

The recent trade agreement announced by U.S. President Trump has significantly shifted market sentiment. News that tariffs on India were agreed to be reduced from 25% to 18% last year accelerated the shift toward risk-on markets. This is not merely a policy change between two countries but is seen as an indication of reduced uncertainty in the global supply chain.

According to data from Jin10, active repurchases of emerging market currencies began immediately after the announcement of the agreement. The Singapore market is no exception, with capital shifting away from low-risk assets observed.

Movements in currency pairs in Singapore’s foreign exchange market

During the Asian trading session, the Singapore dollar has slightly appreciated against the US dollar amid this positive sentiment. Real-time data from LSEG shows the USD/SGD at 1.2710, down 0.1% from the previous day.

This level is within the expected range of experts. While the market fluctuates daily, it is currently forming a medium-term trend.

Experts’ short-term range forecast for USD/JPY

The foreign exchange strategy team at OCBC Bank suggests that, as current risk sentiment remains stable and upward pressure on the US dollar eases, the currency pair is expected to trade within a range of 1.2680 to 1.2760. This analysis indicates technical support and resistance levels during daytime trading in Singapore time.

The team also notes that, in the short term, the optimistic market driven by the trade agreement is likely to continue, but other factors such as inflation indicators and interest rate trends could influence the market. For traders in Singapore, whether this range is broken or not will be crucial for future trading decisions.