SINGAPORE: The Monetary Authority of Singapore (MAS) kept its exchange rate-based monetary policy unchanged on Tuesday (Oct 14), in line with market expectations.
In its October monetary policy statement, the Singapore central bank said it will “maintain the prevailing rate of appreciation” of its Singapore dollar nominal effective exchange rate (S$NEER) policy band.
There are no changes to the width of the policy band and the level at which it is centred.
Ten out of 14 analysts polled by Reuters had expected the MAS to hold off making changes in this scheduled review after standing pat in July when second-quarter growth came in stronger than expected.
Before that, it eased monetary policy twice – in January and April – to support growth on the back of tariff concerns. The MAS holds four policy reviews a year.
Noting that it had made two easing moves this year, the MAS said Singapore’s economic growth “has turned out stronger than expected and the output gap will remain positive in 2025 and come in around 0 per cent next year”.
It also expects core inflation to “trough in the near term” before rising gradually over the course of 2026.
“MAS is in an appropriate position to respond effectively to any risk to medium-term price stability and will continue to closely monitor economic developments amid uncertainties in the external environment,” it said in its policy statement.
Unlike most central banks that manage monetary policy through interest rates, MAS manages monetary policy by letting the local dollar rise or fall against the currencies of its main trading partners within an undisclosed band, known as the S$NEER.
It adjusts its policy by changing the slope, mid-point and width of the band.
