Singapore’s MAS Tightens Policy Again as Oil Risks Lift Inflation Pressure
MAS unexpectedly tightened Singapore’s exchange-rate policy for the second time in four months. It increased the rate at which the S$NEER policy band appreciates, while leaving the band’s width and centre unchanged.
Unlike most central banks, MAS does not use a policy interest rate as its main tool. It manages the Singapore dollar against a basket of currencies, using a stronger currency to help limit imported inflation.
Core inflation rose to 1.6% year-on-year in June from 1.4% in May, while headline inflation reached 1.9%. Singapore’s economy grew 5.7% year-on-year in Q2, above the 5.5% Reuters median estimate and the government’s 2%–4% full-year forecast range.
The decision surprised economists, who had expected no change. With Brent crude returning above US$100 per barrel the prior week, MAS is moving to contain the risk that higher energy prices flow through to Singapore’s import costs.
Singapore is using its currency to contain imported inflation.
Sources: CNBC Markets
CNBC
Singapore tightens monetary policy in surprise move as rising oil prices rekindle inflation risk
Unlike most central banks, the MAS manages medium-term price stability by managing the Singapore dollar exchange rate against a trade-weighted basket of currencies.
3July 27, 2026 123 1
