Singapore allows currency to gain in gradual tightening move

SINGAPORE (Apr 13): Singapore’s central bank made a measured change to policy, allowing its currency to strengthen in the face of solid economic growth, while also acknowledging mounting risks from a US-China trade war.

The Monetary Authority of Singapore, which uses the exchange rate as its main policy tool, increased the slope of the currency band slightly from zero percent, it said in a statement on its website. That was in line with the forecasts from the majority of economists in a Bloomberg survey.

The central bank is moving away from the easing stance adopted in recent years -- like policy-makers from the US to South Korea have done -- as growth in the export-led economy strengthens and inflation continues to pick up slowly. With a trade war brewing between Singapore’s two largest trading partners, the MAS signaled a gradual approach to tightening.

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