NZD/SGD Outlook:
Slightly positive, but likely to move sideways as the rate is above its recent average and lacks a definitive driver.
Key drivers:
Rate gap: The Reserve Bank of New Zealand is signaling potential interest rate cuts, while the Monetary Authority of Singapore has shown a more accommodative stance to support growth.
Risk/commodities: Recent strong dairy prices have supported New Zealand's export income, providing a boost for the NZD.
One macro factor: Ongoing market concerns about labor market performance in New Zealand may weigh on NZD strength.
Range:
Expect the NZD/SGD to hold within its recent range, though minor fluctuations are possible.
What could change it:
Upside risk: Improved labor market data that alleviates current concerns could drive the NZD higher.
Downside risk: Continued deterioration in global risk appetite affecting commodity prices could lead to further NZD weakness.