SGD: MAS keeps policy and forward guidance unchanged to support growth – ANZ

Analysts at ANZ explains that in line with their expectations, the MAS maintained its neutral S$NEER policy in today’s decision, with no change in the slope, centre, and width of the policy band.

Key Quotes

“More importantly, the central bank retained its forward guidance to keep a neutral policy for an extended period, as we had expected. The central bank also maintained its CPI forecasts.”

“We think the policy stance aimed to support the Singapore economy, which is still in an early stage of recovery, despite the central bank’s slightly more upbeat assessment of the global economy. Singapore’s GDP growth in Q1 came in a tad below expectations.”

“Overall, the interplay between the economy’s structural problems and the cyclical improvement in exports suggest only a modest improvement in growth. Going forward, inflation will edge up slightly higher on administered price increases with demand-induced pressures remaining muted.”