Two seemingly unrelated economies are Singapore and Denmark. However, their currencies have been linked by a solidly negative trend. It is important to discover whether or not any direct economic link exists. If not, a trading opportunity exists.
The purpose of Monetary Authority of Singapore is to ‘promote sustained non-inflationary economic growth and a sound and progressive financial centre’. According to the MAS, the Singapore dollar is ‘managed against a basket of the currencies of their major trading partners’. Singapore’s European export partner weighting include: 1.7% for France; 2.0%, U.K.; 2.1%, Netherlands; 2.3%, Belgium-Luxembourg and 2.8 for Germany for a total of only 11% of exports.
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