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Singapore Central Bank Tightens Monetary Policy to Rein in Runway Inflation

Reuters2022-04-14

SINGAPORE, April 14 (Reuters) - Singapore's central bank tightened its monetary policy on Thursday, in a widely anticipated decision, saying the move will slow the inflation momentum as the city state ramps up its battle against soaring consumer prices.

The Monetary Authority of Singapore (MAS) said it would re-centre the mid-point of the exchange rate policy band known as the Nominal Effective Exchange Rate, or S$NEER, at the prevailing level of the S$NEER. It will also increase slightly the rate of appreciation of the policy band.

There will be no change to the width of the policy band.

The MAS manages monetary policy through exchange rate settings, rather than interest rates, because trade flows dwarf its economy, letting the Singapore dollar rise or fall against the currencies of its main trading partners within an undisclosed band.

It adjusts its policy via three levers: the slope, mid-point and width of the policy band.

All 16 economists polled by Reuters expected the MAS to tighten but they were divided on which parameters it would change.

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Comment16

  • ThinkOrSwim
    ·2022-04-14
    Stricter lending = less profitsBanks now = sell 
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  • BenjiFuji
    ·2022-04-14
    What's the pro and con of this?
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  • imsomeonelse
    ·2022-04-14
    Yay
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  • JusTay
    ·2022-04-14
    Like
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  • Karenchong
    ·2022-04-14
    Good 
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  • Theo_4
    ·2022-04-14
    Is this a good thing?
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    • chaicka
      Everything is about trade-offs. In short, pros and cons.
      2022-04-14
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  • Nggimseng
    ·2022-04-14
    Good job
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  • T2huat
    ·2022-04-14
    Ok
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  • IAS
    ·2022-04-14
    Expected 
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  • Hkh
    ·2022-04-14
    Ok
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  • zhenx
    ·2022-04-14
    Like
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  • weekendnote
    ·2022-04-14
    Ok
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  • Qmar
    ·2022-04-14
    Wouldn't just be singapore. Fair few countrieswould have to do the same
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    • chaicka
      Not really. Different country uses different methods to manage inflation and its economy. SG methods are on the fewer side.
      2022-04-14
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    • TriciaChang
      G
      2022-04-14
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  • Ermmmmmm
    ·2022-04-14
    So sgd strengthen ?
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    • chaicka
      Should since mid-point is being raised. But don’t expect too much as there are cons if raise too high.
      2022-04-14
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    • ARIESan
      Shoild be
      2022-04-14
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  • lewisleeks
    ·2022-04-14
    Great [Smile] [Smile] 
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  • Rickyt089
    ·2022-04-14
     Pls like 
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    • JeremyKok
      hi. please like and comment back. thank you.
      2022-04-17
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    • zhenx
      ok
      2022-04-14
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    • TigerKen
      Done. Pls like too
      2022-04-14
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