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TD Securities analysis team is expecting the MAS to reduce the slope of the SGD nominal effective exchange rate (SNEER) band by 50bp to what would amount to a 0.5% per annum slope according to our model, following an unchanged outcome in April.

Key Quotes

“We expect MAS to maintain its policy of “modest, gradual appreciation of SGD”. We expect the width and center of the SNEER band to remain unchanged. While not our base case we see risks skewed towards a bigger than forecast 100bp slope reduction to 0% vs. a no change outcome.”