The Singaporean dollar jumped 0.7% after the Monetary Authority of Singapore (MAS) moved its currency-based policy band higher, adding to worldwide central bank efforts to battle inflation. DBS analysts said in a note that three policy tightening measures by the MAS since last October had put it ahead of other central banks in beginning to normalize monetary policy and trying to control inflation.
Singapore's central bank tightened its monetary policy on Thursday, saying the widely forecast move will slow inflation momentum as the city state ramps up its battle against soaring prices made worse by the Ukraine war and global supply snags. The policy tightening, the third in the past six months, came as separate data showed Singapore's economic momentum waning over the first quarter. The local dollar jumped briefly after the Monetary Authority of Singapore (MAS) re-centred the mid-point of the exchange rate policy band known as the Nominal Effective Exchange Rate, or S$NEER, at its prevailing level.
The Singapore dollar looks set to move up the regional currency rankings next quarter with rising core inflation expected to spur further policy tightening from the MAS in April.