MAS likely to tighten monetary policy despite global trade fears, say economists

(Apr 11): Singapore’s central bank is one step closer to tightening monetary policy this week.

A majority of economists surveyed by Bloomberg predict policy makers will look past the latest trade skirmishes between the world’s two largest economies and assess the city state’s growth outlook as solid and inflation healthy. The Monetary Authority of Singapore, which uses the exchange rate as its main tool, has kept its policy unchanged since shifting to a neutral stance two years ago.

“Growth momentum is positive, global growth is actually good, and trade momentum from the start of the year has been quite good as well,” said Edward Lee, chief economist for South and Southeast Asia at Standard Chartered Plc in Singapore. While “certainly the risks have risen” on trade, “things are simply too accommodative at the moment.”

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