Baku:The Monetary Authority of Singapore (MAS) has decided to maintain its current monetary policy, leaving the Singapore dollar nominal effective exchange rate (S$NEER) policy band unchanged after two consecutive hikes.

According to BERNAMA News Agency, MAS indicated that Singapore's economy is expected to expand robustly in the short term, though growth may moderate as the artificial intelligence (AI) cycle slows from its current rapid pace and global financial conditions become more restrictive.

Core inflation in Singapore is anticipated to decrease significantly from the middle of next year due to a slowdown in supply-driven imported inflation and subdued domestic costs. Core inflation is projected to average between 1.5 and 2.0 percent in 2026, while CPI-all items inflation is expected to be around 2.0 percent. For the coming year, the MAS forecasts core and CPI-all items inflation rates to average between 1.5 to 2.5 percent.

MAS stated that the current appreciating policy band will enable the S$NEER to strengthen, counteracting the expected short-term rise in imported inflation and ensuring a gradual easing of inflationary pressures by 2027. The central bank affirmed its readiness to respond effectively to any risks to medium-term price stability and will continue to monitor economic developments closely.