CONTENTS
HOME
OUR WORK - Managing Risks, Sustaining Growth
A MORE CHALLENGING POLICY ENVIRONMENT
MONETARY POLICY - PROVIDING AN ANCHOR FOR PRICE STABILITY OVER THE MEDIUM-TERM
MANAGING THE CHALLENGES OF INCREASED GLOBAL FINANCIAL UNCERTAINTY
A SOUND AND PROGRESSIVE FINANCIAL CENTRE
CURRENCY
 
MANAGING THE CHALLENGES OF INCREASED GLOBAL FINANCIAL UNCERTAINTY 20
 
International Financial Markets: Subprime Crisis 20
 
Asia: Resilient So Far But There Are Risks 23
 
Enhanced Surveillance and Supervision 24
 
Money Markets: Staying Vigilant 24
 
Business Continuity and Crisis Management 25
 
FATF Mutual Evaluation Exercise 2007/2008 26
 
AML/CFT Notice to SVF Holders 26
 
External Validation Performed Between Other Ministries' Internal Audit Departments and MAS 26
 
Box Story 2 - Audit Committee Guidance Committee 27
 
Risk Management Guidelines for Insurance Companies 28
 
Consumer Protection (Fair Trading) Act - Inclusion of Financial Products and Services 28
 
Corporate Governance of Listed Companies 28
 

Asia: Resilient So Far But There Are Risks

Asia has remained resilient so far in a more uncertain environment. There has been greater equity markets volatility since August 2007, and periodic episodes of portfolio capital outflows. Credit spreads have also widened in line with a general reappraisal and repricing of risks globally. However, the overall impact on the financial sector in Asia has been limited by the relatively small direct exposures of regional financial institutions to the US subprime market and strong domestic economic fundamentals in most Asian economies. Asian export growth has been supported by demand from within the Asian region and from other regions such as the Middle East, thus somewhat offsetting the softening US demand. Barring a full-blown US recession, this partial substitution between export destinations should continue to support the region's growth.

A primary concern for Asian central banks is the acceleration in inflation across the region, reflecting the rise in oil and food prices. Even as central banks respond with higher policy rates, equity markets have experienced renewed volatility as investors begin to act on concerns about the impact of inflation and tightening monetary policy on growth prospects in Asia. Looking ahead, while Asian economies have weathered the storm relatively well thus far, they will continue to face challenges arising from slowing global growth, continued financial market volatility and inflation.