The value of the Singapore dollar gained against its U.S. counterpart on Thursday amid a rally of risk sentiment for efforts to rein in the sovereign debt crisis tearing through the euro zone, Dow Jones Newswires reports.
The monetary unit gained from reports about global regulator the International Monetary Fund pursuing new loan capacities of $500 billion as well as the resumption of discussions between the government of debt-hobbled Greece and private-sector creditors. The Aegean nation has been awarded two tranches of international bailout aid.
"We attribute the move in the (U.S.) dollar to a euro short squeeze and an increase in risk sentiment, though the choppy trading suggests not everyone holds this view," Maybank, a financial institution in Singapore, told the news source.
Government bonds for the Southeast Asian nation dropped amid investor preference for risk assets as sentiment continued on the upswing.
Spain conducted a bond auction on Thursday that raised more funds than projected, according to The Associated Press. The results are considered a positive indicator in light of the nation's credit rating being downgraded last week by Standard & Poor's.
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