BoltAI:
The Monetary Authority of Singapore (MAS) has eased its monetary policy for the first time since March 2020, driven by expectations of slower economic growth and easing inflation. In its January 2025 policy statement, MAS announced a slight reduction in the slope of the Singapore dollar nominal effective exchange rate (S$NEER) policy band while keeping its width and center level unchanged. This adjustment aims to maintain medium-term price stability amid a forecast for Singapore's economic growth to decelerate, projected to be between 1% and 3% for the year, down from 4% the previous year.
Additionally, MAS lowered its 2025 core inflation forecast, which is expected to average between 1% and 2%, down from an earlier prediction of 1.5% to 2.5%. This adjustment follows recent data showing core inflation at a three-year low of 1.8% in December 2024. MAS noted that business costs and demand pressures would likely remain contained, aided by declining global oil prices and favorable conditions in key food supplies.
Headline inflation for 2025 was left unchanged at a range of 1.5% to 2.5%. The outlook for both inflation and growth is considered uncertain, particularly in relation to external factors such as global trade tensions and tightening financial conditions. The policy change reflects MAS's vigilant approach to managing Singapore's economic environment.
Opinion:
It seems that SG is cautious.
Our currency is strong against our neighbors.
Unless something drastic happens e.g. 100% WP election, Terrorism, etc
We should still maintain good growth this year.