Singapore, April 5 - The Singapore dollar hit its highest level in more than seven years on Wednesday, boosted by a combination of factors including expectations for monetary tightening at next week's central bank policy review.
Broad-based U.S. dollar weakness and speculation over further strength in the Chinese yuan and the Malaysian ringgit were also behind strong gains in the Singapore dollar, dealers said.
The Singapore dollar rose as far as 1.6072 per dollar, up 0.4 percent from levels traded late in Asia on Tuesday, and its strongest level since late 1998.
It had hit a high in overnight trade amid strong foreign demand for Asian currencies, dealers said.
"The Sing dollar is following the ringgit as Malaysia is one of Singapore's main trading partners and the ringgit has been rising sharply," said a trader in Singapore.
"Also, the market is expecting the MAS (Monetary Authority of Singapore) to tighten monetary policy next week so this is pushing up the Sing. Asian economies generally are doing well and this is a factor too."