SINGAPORE: The Monetary Authority of Singapore (MAS) on Monday (Apr 14) loosened monetary policy for the second time in a row as economic fears rise due to the trade war brewing between the US and China. It also lowered core inflation expectations for the year.
The central bank's April monetary policy statement said they would "reduce slightly" the rate of appreciation of the Singapore dollar nominal effective exchange rate, though the policy of "modest and gradual appreciation" would continue.
There will be no change to the width of the band and the level at which it is centred, the central bank said.
MAS also said it expects core inflation to average 0.5 per cent to 1 per cent in 2025, down from its previous expectation of 1 per cent to 2 percent.
The move to loosen policy was in line with expectations from nine out of 10 analysts polled by Reuters. They predicted that the central bank would loosen policy by reducing the slope of the band
The central bank manages monetary policy through the exchange rate instead of interest rates. It lets the Singapore dollar strengthen or weaken against currencies of the country's main trading partners within an undisclosed band.
MAS can change the slope, mid-point or width of the band.
Before the easing of policy in January, MAS kept monetary policy unchanged for nearly five years.
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The central bank's April monetary policy statement said they would "reduce slightly" the rate of appreciation of the Singapore dollar nominal effective exchange rate, though the policy of "modest and gradual appreciation" would continue.
There will be no change to the width of the band and the level at which it is centred, the central bank said.
MAS also said it expects core inflation to average 0.5 per cent to 1 per cent in 2025, down from its previous expectation of 1 per cent to 2 percent.
The move to loosen policy was in line with expectations from nine out of 10 analysts polled by Reuters. They predicted that the central bank would loosen policy by reducing the slope of the band
The central bank manages monetary policy through the exchange rate instead of interest rates. It lets the Singapore dollar strengthen or weaken against currencies of the country's main trading partners within an undisclosed band.
MAS can change the slope, mid-point or width of the band.
Before the easing of policy in January, MAS kept monetary policy unchanged for nearly five years.
Continue reading...