Singapore poised to tighten monetary policy amid strong growth and rising inflation risks

SINGAPORE — Singapore is expected to tighten monetary policy at a scheduled review on Wednesday (Oct 7) as robust growth and inflation risks bolster the case for another move.

All 10 analysts polled by Reuters expect the Monetary Authority of Singapore (MAS) to tighten policy on Oct 14.

The MAS surprised markets in July by "very slightly" tightening policy, adding to a policy move in April this year.

The Middle East conflict has caused significant uncertainty as tensions escalate, with oil prices rising even as talks continue between Iran and the US to reopen the Strait of Hormuz ahead of the Nov 3 US midterm elections.

OCBC economist Selena Ling said there is upside risk to core inflation as a widening Middle East conflict threatens to broaden sticky price pressures across goods and services, while the threat of a "super El Nino" could further drive up food costs.

The weather pattern has the potential to cause floods, droughts, extreme heat and crop losses across the world and is expected to reach peak intensity by early 2027.

Singapore manages monetary conditions by letting the local dollar rise or fall against the currencies of its main trading partners within an undisclosed trading band, known as the Singapore dollar nominal effective exchange rate, or S$NEER.

It adjusts settings via three levers: the slope, mid-point and width of the band.

Barclays economist Brian Tan said he expects the central bank to again raise the slope of its exchange rate policy band by a slight 25-basis-point adjustment, as the "sheer magnitude of the AI boom" drives relatively robust gross domestic product growth heading into 2027.

"However, the reality that the translation of economic growth to inflation has likely proved to be milder than the MAS expected will likely continue to restrain the central bank from a more aggressive pace of tightening," he said.

Core and headline inflation in August stood at 2.2 per cent and 2.3 per cent, respectively, official data showed last month. For the full year, MAS expects core and headline inflation to average 1.5 per cent to 2.5 per cent in 2026.

Central banks are facing a tougher battle against inflation as the Iran war pushes oil prices higher, feeding through to transport, energy and production costs worldwide.

The US Federal Reserve raised rates by a quarter-percentage point last month, while markets are also betting on more rate hikes by the European Central Bank as euro zone inflation continues to trend higher.

新加坡——由于强劲的经济增长和通胀风险，预计新加坡将在周三（10月7日）的例行货币政策评估中收紧货币政策，这为再次采取货币政策措施提供了依据。

路透社调查的 10 位分析师均预计新加坡金融管理局 (MAS) 将于 10 月 14 日收紧货币政策。

新加坡金融管理局 (MAS) 在 7 月份出人意料地“略微”收紧了货币政策，这是继今年 4 月份收紧政策之后的又一次举措。

中东冲突造成了极大的不确定性，紧张局势不断升级，尽管伊朗和美国仍在就11月3日美国中期选举前重新开放霍尔木兹海峡进行谈判，但油价仍在上涨。

华侨银行经济学家林思琳表示，由于中东冲突不断扩大，商品和服务价格持续上涨，核心通胀面临上行风险；而“超级厄尔尼诺”现象的威胁可能会进一步推高食品价格。

这种天气模式有可能在全球范围内造成洪水、干旱、极端高温和农作物减产，预计将在 2027 年初达到峰值强度。

新加坡通过让本币兑其主要贸易伙伴货币在一个未公开的交易区间内波动来管理货币状况，这个交易区间被称为新加坡元名义有效汇率（S$NEER）。

它通过三个控制杆来调节设置：斜率、中点和带宽。

巴克莱银行经济学家布莱恩·谭表示，他预计央行将再次小幅上调汇率政策区间的斜率 25 个基点，因为“人工智能繁荣的巨大规模”将推动国内生产总值在 2027 年实现相对强劲的增长。

“然而，经济增长转化为通胀的程度可能比新加坡金融管理局预期的要温和，这一现实可能会继续抑制央行采取更激进的紧缩措施，”他说道。

官方数据显示，8月份核心通胀率和总体通胀率分别为2.2%和2.3%。新加坡金融管理局（MAS）预计，到2026年全年，核心通胀率和总体通胀率的平均水平将在1.5%至2.5%之间。

由于伊朗战争推高了油价，进而推高了全球的运输、能源和生产成本，各国央行正面临着更加严峻的抗击通胀的挑战。

美国联邦储备委员会上个月将利率提高了0.25个百分点，而随着欧元区通胀持续走高，市场也押注欧洲央行将进一步加息。