SINGAPORE: In a dramatic shift in the forex market, the Singapore dollar, Malaysian ringgit, and Thai baht experienced sharp declines today as the US dollar surged following Donald Trump's victory in the US presidential election.

The Singapore dollar fell by an alarming 1.6%, reaching its lowest point in three months and marking its most significant single-day drop since November 2011. Meanwhile, the Malaysian ringgit, which had been the top-performing currency in Southeast Asia earlier this year, dropped 1.3% to its lowest level since mid-August.

A recent Reuters poll suggests that Bank Negara Malaysia (BNM) is expected to keep its key interest rate steady at 3.00%. This comes amid heightened concerns from BNM about volatility in the ringgit, with officials stating they are prepared to intervene if necessary.

The Thai baht mirrored a similar fate, plummeting 1.3% to a two-month low. Other currencies in the region followed suit, with South Korea's won dropping 1.5%, reaching its lowest level since April, and the Indonesian rupiah declining 0.8%, nearing a three-month low. Indonesia’s central bank remains vigilant, ready to implement measures to stabilize its currency amidst these fluctuations.

Ken Cheung Kin Tai, the chief Asian FX strategist at Mizuho Bank, indicated that investors in the region are increasingly apprehensive about the effects of tariffs, particularly given the reliance of most Asian economies on trade growth.

Analysts from MUFG have warned that currencies like the South Korean won, Singapore dollar, Malaysian ringgit, and Thai baht may face significant challenges under Trump’s administration, due to their dependence on exports and possible slowdowns in the Chinese economy. Notably, the Chinese yuan and the Mexican peso are also seen as susceptible to the impending pressures of a stronger dollar and higher tariffs associated with Trump’s economic policies.

In the wake of Trump's election win on Wednesday morning, as reported by The New York Times, the dollar index surged by 1.42%, reflecting a strong upward trend against a basket of six major currencies. The victory was solidified when Trump secured crucial battleground states, including Wisconsin, surpassing the 270 electoral votes needed for presidency.

As US Treasury yields reached multi-month highs, driven by strong election performance projections, analysts are setting their sights on how these developments will influence Asian markets moving forward. As the dust settles on Trump's election win, the central question remains: will these regional currencies continue to falter, or can we expect a shift in market sentiment in the upcoming weeks?

Stay tuned as we unravel the implications of these pivotal changes for economies across Asia!