According to Khoon Goh, analyst at ANZ, the case for further policy tightening by the Monetary Authority of Singapore (MAS) at their upcoming semi-annual review is weak, in their view.
“With Singapore’s economic growth slowing to trend, the MAS Core Inflation showing signs of easing, and risks to the global economy tilted to the downside, we expect no change to the slope and width of the policy band or the level at which it is centred.”
“However, this is only a pause, and not an end, to the MAS’s policy normalisation cycle. We certainly do not expect the MAS to join the dovish turn seen among other central banks recently.”
“We believe that overall policy settings are still below neutral levels, and further policy tightening down the track is likely when growth recovers and domestic inflation pressures emerge again.”