The Monetary Authority of Singapore (MAS) tightened monetary policy and increased its inflation forecast, citing volatility in energy prices and supply disruptions from the Middle East conflict.
The central bank will "increase slightly" the appreciation rate of the Singapore dollar nominal effective exchange rate (S$NEER) policy band, allowing the Singdollar to strengthen more quickly and make imports cheaper. The width and midpoint of the band remain unchanged.
MAS also raised its forecast for core and headline inflation to 1.5-2.5 per cent, up from a previous forecast of 1-2 per cent. This is the second adjustment this year.
MAS manages monetary policy by adjusting the exchange rate against its trading partners' currencies within an undisclosed band. The authority last tightened policy in October 2022.