Singapore FEW monetary policy statements in recent years have so vexed economists. Just one day before the central bank releases its policy decision on Tuesday, the market remains divided on how the Monetary Authority of Singapore (MAS) will move. Economists are split on how MAS will tweak its Singapore dollar policy – or whether it will even change its stance at all. They say any of three options is possible: a downward recentring; widening; or no change to the S$NEER (Singapore dollar nominal effective exchange rate) band. But as for which is most likely to materialise on Tuesday, the market can’t seem to make up its mind. Views were split more or less evenly last Friday, with seven economists calling for easing via a lowering of the policy band’s mid-point, and six seeing no easing. Of the latter six, half forecast a widening of the S$NEER band, while the other half saw no change. Part of the uncertainty stems from the fact that on Jan 28, MAS surprised with an off-cycle policy statement – decreasing the slope of its S$NEER band, while maintaining its policy of a modest and gradual appreciation of the Singapore dollar. Typically, MAS has two policy… Read full this story
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