Singapore's central bank looks likely to stick to neutral

(Oct 12): Singapore’s central bank is widely seen sticking to a neutral stance on Friday, but it may be moving closer to tightening policy as the economy continues to strengthen.

All but one of the 23 economists surveyed by Bloomberg predict the Monetary Authority of Singapore, which uses the exchange rate rather than interest rates as its main tool, will keep its policy stance where it is: seeking no appreciation in the currency against a trading basket.

Less clear is whether the MAS will signal it’s ready to tighten next year. More than half of the economists in the survey expect that forward-looking language used in the previous two policy statements -- that the neutral stance is appropriate for an “extended period of time” -- will be dropped. Eight predict some tightening at the next meeting in April.

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