Singapore’s non-oil domestic exports (NODX) rose 46.2% year on year in August, beating the Bloomberg consensus of 35.1% and accelerating from 24.1% in July to the fastest pace since October 1998. Electronics led the expansion, while non-electronic NODX also recovered. For the year to date, NODX is up 22.4%, well above the government’s 14–16% full-year forecast, with momentum linked to AI-related demand and the launch cycle for major consumer electronics.
Attention is shifting to the August CPI report due on 23 September as inflation pressures are expected to firm. Headline inflation is forecast at 2.3% year on year versus 2.2% in July, and core inflation—excluding private transport and accommodation—is projected at 2.2% compared with 2.0% previously, which would be the highest core reading in nearly two years. In foreign exchange, USD/SGD was around 1.2760, after rising 0.7% last week on broad USD strength and elevated global oil prices.
Inflation Outlook And Policy Implications
With tomorrow’s CPI release expected to show core inflation rising to 2.2%, we believe derivative traders should prepare for heightened volatility in SGD pairs. This potential spike in inflation, combined with Singapore’s strongest export growth since 1998, keeps the risk of Monetary Authority of Singapore (MAS) tightening firmly on the table. We recommend focusing on short-term options to hedge against sudden shifts in the Singapore Dollar.
Historically, when core inflation ticks upward in Singapore, the MAS tends to maintain a hawkish stance to prevent the economy from overheating. Looking at recent data from earlier this year, Singapore’s economy grew by 2.9% year-on-year in the second quarter of 2026, proving that domestic growth remains highly resilient. This solid macroeconomic backdrop gives the central bank plenty of room to keep its appreciation path for the S$NEER steep.
Trading Strategies For The Singapore Dollar
We suggest traders look at entering long positions on the SGD against weaker regional peers, as the local currency is backed by a massive 46.2% surge in non-oil domestic exports. For those trading USD/SGD, which recently hovered around the 1.2760 level, buying near-term call options on the SGD could capture upside if tomorrow’s inflation data surprises to the high side. However, we must also watch global oil prices, as any sudden spike could support the broader US Dollar and temporarily cap SGD gains.
