Deutsche Bank expresses bearish bias on Singapore dollar

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Deutsche Bank also dismissed the idea of drawing confidence from Monetary Authority of Singapore's (MAS) decision to keep policy unchanged.

"Conditions for easing nearly existed, with growth disappointing, inflation forecasts lowered, and imported inflation negative," said the bank.

It advised FX traders that the risk-reward is firmly in favor of maintaining long USD/SGD and short S$NEER positions.

With S$NEER trading at the top end of the band, the risk-reward is asymmetric. Downside in USD/SGD will be limited by firm intervention at the bands in the near-term, a move higher in the USD complex of Singapore's trade partners in the medium-term, and potentially by the risk of easing down the line," Deutsche Bank said.