The Canadian dollar (CAD) has recently experienced downward pressure, influenced primarily by declining oil prices, which are currently trading at 65.07 USD per barrel, about 1.7% below their three-month average. As Canada is a significant oil exporter, fluctuations in oil prices directly affect the value of the CAD. Recent forecasts highlight that the CAD has reached seven-day lows against the Singapore dollar (SGD) at around 0.9246, which is also just beneath its three-month average, having oscillated within a stable 1.7% range between 0.9206 and 0.9359.
Analysts have noted that recent GDP data and the prospect of the Canadian economy contracting have added to the pressure on the loonie. This comes alongside a drop in oil prices due to oversupply concerns and geopolitical tensions that have negatively influenced market sentiment. Furthermore, the Bank of Canada has cut interest rates to a three-year low of 2.5%, signaling its response to these economic challenges, which may further weigh on the CAD as lower rates generally discourage investment.
On the other hand, the Singapore dollar (SGD) has shown resilience, buoyed by stronger-than-expected economic growth of 2.9% year-on-year in Q3 2025. With the Monetary Authority of Singapore (MAS) maintaining its current monetary policy settings, confidence in the SGD remains robust despite external uncertainties. This favorable economic outlook for Singapore indicates that the SGD may maintain a stronger stance against the CAD moving forward.
Overall, the interplay between oil price movements, the Bank of Canada's monetary policy, and the economic prospects of Canada and Singapore will be critical in determining the CAD/SGD exchange rate in the near term. Markets are closely monitoring these developments, as they will likely shape currency fluctuations and influence decisions related to international transactions.
