DAVOS, Switzerland: The Singapore dollar surged to its highest in three years against the US dollar on Thursday (Jan 25), after US Treasury Secretary Steven Mnuchin said he would welcome a weaker greenback.
As of 11.09am, the Singapore dollar was trading at 1.306 to the US dollar, the highest since it closed at 1.3044 on Nov 28, 2014, according to Bloomberg data.
Mnuchin's words sent the US dollar reeling and underlined concerns that US President Donald Trump is stepping up his attack on China and other big trading partners as part of his America First agenda.
The US Treasury Secretary made the remark, seen by markets as a departure from traditional US currency policy, at the World Economic Forum in Davos, where other world leaders have made swipes at what they see as US protectionism.
Tough US talk on trade, on the eve of Trump's arrival at the Swiss ski resort on Thursday, contrasted sharply with a chorus of government leaders, from India and Brazil to Germany and Canada, who urged cooperation and criticised protectionism.
"Obviously a weaker dollar is good for us as it relates to trade and opportunities," Mnuchin told a press briefing.
Commerce Secretary Wilbur Ross later told CNBC that his colleague was "not advocating for a weaker dollar", but he also struck a combative tone.
Asked if he was concerned about sparking a trade war, Ross said: "Trade war has been in place for quite a little while, the difference is the US troops are now coming to the ramparts.”
Pressed about Mnuchin's remarks, White House spokeswoman Sarah Sanders said at a daily briefing in Washington: "We believe in a free-floating currency. The president has always believed in that."
"We have ... a very stable dollar, in large part due to how well the US economy is doing right now," she added.