Singapore Monetary Policy


Singapore: MAS keeps monetary policy unchanged

April 14, 2014

At its first semi-annual policy meeting of 2014, which took place on 14 April, the Monetary Authority of Singapore (MAS) decided to maintain its stance on the currency's gradual appreciation. This was evident as the MAS did not change the slope, the center and the width of the Singapore dollar nominal effective exchange rate (S$NEER)-a policy first implemented in April 2012.

The Central Bank's latest statement pointed out that the domestic economy lost momentum in the first quarter. However, the MAS expects economic activity to accelerate later in the year mainly due to a recovery in the United States and Europe. Regarding price developments, the Bank added that, “CPI-all items inflation and MAS Core Inflation are expected to pick up in the coming months after easing recently.” The acceleration in the rise of consumer prices will result from higher labor costs and a low base effect from last year when the Certificates of Entitlement (COE) premiums fell. The MAS will maintain its policy of modest appreciation of the S$NEER policy band in order to accommodate temporary fluctuations.

FocusEconomics Consensus Forecast panelists expect the exchange rate to reach 1.21 SGD per USD by the end of this year. By the end of 2014, the panel sees the exchange rate at 1.20 SGD per USD.

Author:, Senior Economist

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Note: Daily spot exchange rate of Singapore dollar (SGD) against U.S. dollar (USD).
Source: Source: Thomson Reuters.

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