July 18, 2007 (LPAC) -- With Japan and Taiwan tightening their currencies, speculators are moving to Singapore for the "cheap money" they need for the carry trade, reports Bloomberg's Andy Mukherjee. Taiwan is trying to limit or end the mass borrowing of its currency for investment in high interest-rate nations. Singapore, writes Mukherjee, now has 2.4% rates, almost 1 percentage point lower than at the beginning of the year, while Taiwan's effective rate is 2.6%. Japan's rate is still at 0.5%, but is likely to be raised soon.

Singapore, the British banking outpost in Asia, is unlikely to move against the speculators, according to Mukherjee, despite the fact that the Singapore property market and the stock exchange are "in a frenzy."