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By Tang See Kit 14 Apr 2021 08:40AM (Updated: 14 Apr 2021 08:40AM )
SINGAPORE: Singapore’s central bank left its monetary policy unchanged on Wednesday (Apr 14), as widely expected, on the back of uncertainties from the COVID-19 pandemic and weak inflation.
In its half-yearly monetary policy statement, the Monetary Authority of Singapore (MAS) said it is maintaining “a zero per cent per annum rate of appreciation” of its policy band.
The width of the policy band and the level at which it is centred also remains unchanged.
MAS said it expects the Singapore economy to "grow at an above-trend pace" this year. At the same time, however, it also expects sectors that were worst hit by the crisis to continue to face significant demand shortfalls.
It also flagged "significant" uncertainties from the COVID-19 pandemic, including the possibility of further virus mutations, which could derail global and domestic recovery.
"As the negative output gap narrows, core inflation should rise gradually from its current subdued levels but remain below its historical average," it said.
"As core inflation is expected to stay low this year, MAS assesses that an accommodative policy stance remains appropriate.”
All 15 economists polled by Reuters had forecast that the central bank would keep its exchange rate-based policy settings unchanged.
Instead of setting interest rates, the MAS manages the economy through the currency. It lets the exchange rate float within an unspecified policy band, and changes the slope, width and centre of that band when it wants to adjust the pace of appreciation or depreciation of the Singapore dollar.
It kept policy unchanged at its last review in October last year and said its accommodative stance “ will remain appropriate for some time ”.
On inflation, the central bank upgraded its 2021 forecasts for headline inflation on Wednesday.
It now sees headline inflation at 0.5 to 1.5 per cent, up from -0.5 to 0.5 per cent previously.
Core inflation – a key consideration for MAS monetary policy – is set to “rise only gradually” for the rest of the year, and is expected to come in at 0 to 1 per cent in 2021.
Source: CNA/sk
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MAS leaves monetary policy unchanged amid COVID-19 uncertainties, low inflation
A view of the Monetary Authority of Singapore's headquarters on Jun 28, 2017. (File photo: Reuters/Darren Whiteside)By Tang See Kit 14 Apr 2021 08:40AM (Updated: 14 Apr 2021 08:40AM )
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SINGAPORE: Singapore’s central bank left its monetary policy unchanged on Wednesday (Apr 14), as widely expected, on the back of uncertainties from the COVID-19 pandemic and weak inflation.
In its half-yearly monetary policy statement, the Monetary Authority of Singapore (MAS) said it is maintaining “a zero per cent per annum rate of appreciation” of its policy band.
The width of the policy band and the level at which it is centred also remains unchanged.
MAS said it expects the Singapore economy to "grow at an above-trend pace" this year. At the same time, however, it also expects sectors that were worst hit by the crisis to continue to face significant demand shortfalls.
It also flagged "significant" uncertainties from the COVID-19 pandemic, including the possibility of further virus mutations, which could derail global and domestic recovery.
"As the negative output gap narrows, core inflation should rise gradually from its current subdued levels but remain below its historical average," it said.
"As core inflation is expected to stay low this year, MAS assesses that an accommodative policy stance remains appropriate.”
READ: Singapore economy grows 0.2% in Q1 amid easing of COVID-19 restrictions
All 15 economists polled by Reuters had forecast that the central bank would keep its exchange rate-based policy settings unchanged.
Instead of setting interest rates, the MAS manages the economy through the currency. It lets the exchange rate float within an unspecified policy band, and changes the slope, width and centre of that band when it wants to adjust the pace of appreciation or depreciation of the Singapore dollar.
It kept policy unchanged at its last review in October last year and said its accommodative stance “ will remain appropriate for some time ”.
On inflation, the central bank upgraded its 2021 forecasts for headline inflation on Wednesday.
It now sees headline inflation at 0.5 to 1.5 per cent, up from -0.5 to 0.5 per cent previously.
Core inflation – a key consideration for MAS monetary policy – is set to “rise only gradually” for the rest of the year, and is expected to come in at 0 to 1 per cent in 2021.
Source: CNA/sk
Continue reading...