Investing Updates: Singapore keeps monetary policy settings unchanged in October, for second straight quarter

Source:

https://www.businesstimes.com.sg/singapore/singapore-monetary-policy-october

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The Monetary Authority of Singapore (MAS) kept its monetary policy settings unchanged for the second consecutive quarter at its October 2025 review, maintaining the current rate of appreciation of the Singapore dollar nominal effective exchange rate (S$NEER) policy band, along with its width and centre. The decision, widely expected by economists, reflects MAS’s confidence in the economy’s resilience amid moderating inflation and global uncertainty.

MAS also lowered its 2025 inflation forecasts, projecting core inflation at around 0.5% and headline inflation between 0.5% and 1.0%, down from the previous 0.5%–1.5% range. The central bank expects core inflation to bottom out soon and rise gradually in 2026 as temporary disinflationary factors fade.

The policy statement struck a more optimistic tone than July’s, noting that while growth will moderate, “the extent of the downturn should be contained.” Economists such as Maybank’s Chua Hak Bin and UOB’s Jester Koh said MAS’s language suggests confidence in maintaining stability and conserving policy space for potential action in 2026.

Recent data supports this optimism. Core inflation eased to 0.3% in August, while headline inflation dipped to 0.5%. Meanwhile, Singapore’s Q3 GDP grew 2.9% year on year, surpassing forecasts despite trade headwinds. MAS said the output gap remains positive, indicating above-trend growth for now, though it expects a return to near-trend pace in 2026.

Easing global import costs, improved productivity, and government subsidies have helped cool price pressures. MAS reaffirmed it remains “in an appropriate position to respond effectively” to any risks to medium-term price stability, signaling a steady stance heading into 2026.

Opinion:

Pray that economic mixed rice prices stay the same!