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Singapore To Maintain Current Monetary Policy

The Monetary Authority of Singapore said that it would continue to adopt its current monetary policy of a gradual and modest appreciation of the Singapore dollar.

The Monetary Authority of Singapore said that it would continue to adopt its current monetary policy of a gradual and modest appreciation of the Singapore dollar. However, MAS raised its inflation target for this year to 1% to 2%, up from a previous forecast of 0.5% to 1.5%. MAS also said that even though consumer price inflation is expected to be higher this year, the overall domestic inflationary pressures are likely to be contained under the current policy stance.

The liquidity conditions have tightened significantly since the last policy review, added MAS. The Singapore dollar has gained mainly due to strong investor interest in Asian markets because of optimistic economic prospects. MAS said domestic interest rates have also increased as the market tries to catch up with the increasing interest rates in the U.S. coupled with the domestic economy's strength.

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