SINGAPORE: The greenback soared to a 15-month high against the Singapore dollar and stood tall against other Asian currencies on Thursday (Oct 4), after robust US economic figures and bullish comments from the Federal Reserve boosted the dollar, prompting sustained regional outflows.
Mr Khoon Goh, head of Asia research at ANZ Banking Group in Singapore, said the mix of strong US data and the Fed chair's comments bumped up the dollar and US bond yields, putting downward pressure on Asian currencies.
On Thursday, the US dollar touched 1.3828 against the Singapore dollar, its highest since Jul 11 last year.
The greenback also shot to its highest so far this year on the yen and an all-time high against the Indian rupee. It also hit a fresh 20-year high against the Indonesian rupiah.
The dollar had taken off after an influential survey of the US services sector showed activity at its strongest since August 1997, sparking speculation the payrolls report on Friday could also surprise.
Adding to the bullish mood, Federal Reserve chairman Jerome Powell said on Wednesday that the central bank may raise interest rates above an estimated "neutral" setting as the "remarkably positive" US economy continues to grow.
US Treasury yields jumped to multi-year peaks on Wednesday, with the 10-year yield reaching a seven-year high after Wednesday's robust data bolstered the case for the Fed to raise interest rates again in December and beyond.
"The Fed stands poised to keep hiking rates in the near term and sentiment towards the dollar has shifted significantly," said Mr Mitsuo Imaizumi, chief FX strategist at Daiwa Securities.