Singapore announces Q3 GDP forecast, MAS monetary policy

On Monday, July 6, 2020, cyclists will board the Esplanade Bridge while the building is standing in Singapore’s Central Business District.

Weirentei | Bloomberg | Getty Images

Singapore — Singapore’s central bank tightened monetary policy in a surprising move on Thursday. The economy in the third quarter grew 6.5% compared to a year ago.

The Monetary Authority of Singapore (the central bank of the country) said in its twice-yearly monetary policy statement that it had slightly raised the slope of the currency band, which is the nominal effective exchange rate of the Singapore dollar.

This means that the Singapore dollar is allowed to rise against a basket of currencies within a private band. According to the central bank, the width of the band and the level centered have not changed.

Singapore’s economic growth could remain above trend in the coming quarters.

Monetary Authority of Singapore

MAS manages monetary policy by setting exchange rates rather than interest rates. Adjust the band with three levers: slope, midpoint, and width.

NS Singapore dollar It increased by about 0.2% and reached a high of 1.349 / in 3 weeks. U.S. dollar Following the move of the central bank.

Eleven of the 13 economists surveyed by Reuters expected the Central Bank of Singapore to remain unchanged in its policies.

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The currency band adjustment “will ensure price stability in the medium term, recognizing the risks to economic recovery,” MAS said.

Core inflation, excluding accommodation and private transportation, is expected to rise between 1% and 2% next year in the medium term. Core inflation is MAS’s recommended price gauge.

“Singapore’s economic growth is likely to remain above trend in the coming quarters,” said the central bank. “Production in 2022, except for the global virus resurgence and slowing pace of economic resumption. Should return to its potential. “

“At the same time, external and domestic cost pressures are increasing, reflecting both normalization of demand and tight supply,” he added.

Growth is slightly lacking in estimates

Singapore’s economy grew 6.5% in the third quarter of 2021 compared to a year ago, official preliminary estimates said Thursday.

Analysts surveyed by Reuters expected Singapore’s economy to grow 6.6% year-on-year in the third quarter.

Singapore’s Ministry of International Trade and Industry said in a statement that the economy had expanded 0.8% on a seasonally adjusted quarterly basis.

This is breaking news. Please check for updates.

Singapore announces Q3 GDP forecast, MAS monetary policy

Source link Singapore announces Q3 GDP forecast, MAS monetary policy

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