Singapore's Central Bank Holds Monetary Policy Steady

Singapore's central bank, the Monetary Authority of Singapore (MAS), has opted to maintain its current monetary settings, despite signs of economic growth in the third quarter. This decision comes as the economy grew 4.1% year-on-year, supported by a recovery in manufacturing, a notable increase from 2.9% growth in the second quarter.

In its statement, MAS noted that the risks to Singapore's inflation outlook have become more balanced and expects the economy to grow at the upper end of its forecast range of 2.0% to 3.0% for 2024. However, it also warned of significant external risks, particularly around geopolitical and trade conflicts.

Economists are forecasting a potential loosening of monetary policy early next year. OCBC economist Selena Ling remarked, "The growth outlook is more sanguine," but cautioned about ongoing geopolitical risks. Similarly, Capital Economics' Shivaan Tandon noted that the MAS may pivot towards easing in January to prevent overly tight monetary conditions from constraining growth further.