Singapore monetary authorities in Singapore.
Wei Leng Tay Bloomberg Getty's paintings
Singapore loosened the monetary policy on Friday for the first time since 2020, citing faster than expected inflation and warning about growth slowdown.
Singapore monetary authorities said that they will slightly reduce the slope of their exchange rate policy, known as a nominal effective exchange rate of Singapore dollar exchange, i.e. S $ Neer.
In its edition The masses reported that this year's economic growth dynamics in Singapore will be slowed down, and the base inflation will “weaken faster than expected.”
He added that inflation will remain below 2%this year, “reflecting the return to low and stable basic price pressure in the economy.”
It is forecasted that basic inflation in 2025 will amount to 1.5-2.5% on average compared to 2.4% in 2024.
The masses also reduced its forecasts regarding the base inflation rate – not taking into account the price of accommodation and private transport – to an average of 1-2% in 2025, i.e. less than 1.5-2.5% expected in the forecast Monetary policy message from October 2024.
It is expected that the increase in Singapore GDP in 2025 will be 1-3%, i.e. it will be slower than 4% recorded in 2024.
“The impact of changes in global trade policy may affect the national production sector and trade services,” Mas wrote.
Unlike other central banks that increase the interest rates of domestic loans, the masses change the Singapore dollar exchange rate settings.
The central bank strengthens or weakens its currency in relation to the basket of its main trading partners, thus effectively determining the Neer. The exact exchange rate is not set, rather, Neer can move in a set policy range, whose exact levels are not disclosed.
The Singapore dollar slightly weakened after the decision to the dollar, slightly weakening to 1.3556, while the country-city course Straits Times index He climbed slightly.
