Singapore Keeps Monetary Policy Unchanged
April 12 2017 - 8:24PM
RTTF2
Singapore central bank kept its monetary policy unchanged on
Thursday as policymakers said the neutral stance is appropriate to
ensure price stability.
The Monetary Authority of Singapore said it will maintain the
rate of appreciation of the S$NEER policy band at zero percent.
The width of the policy band and the level at which it is
centred will be unchanged, the bank said. As indicated in the
October meeting, policymakers observed that a neutral policy stance
is appropriate for an extended period and should ensure medium-term
price stability.
The MAS applies the exchange rate against a basket of currencies
within an undisclosed band as its monetary policy tool. The central
bank holds monetary policy meeting twice a year.
MAS core inflation was forecast to rise gradually, largely on
account of higher global oil prices. Core inflation is projected to
average 1-2 percent this year, while overall consumer price
inflation is forecast to rise to 0.5-1.5 percent.
Over the medium term, core inflation is expected to trend
towards but average slightly below 2 percent.
The city-state economy should expand by 1-3 percent in 2017, not
markedly different from the growth of 2 percent in 2016, the bank
said.
Data released earlier in the day showed that annualized
seasonally adjusted gross domestic product contracted 1.9 percent
sequentially in the first quarter.
However, Krystal Tan, an Asia economist at Capital Economics,
said stronger export demand is set to help drive a decent recovery
in the economy this year.
The economist said the MAS is unlikely to change its monetary
policy stance this year.
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