Response to Letter “Strong Singdollar a curse in disguise” - Straits Times, 22 November 2023
We welcome Mr Andy Wang Ze Yu’s observations on the Monetary Authority of Singapore’s (MAS) monetary policy (Is a strong Singapore dollar good for Singaporeans?, Nov 22).
2 Singapore’s weaker export performance over the past year has been mainly due to subdued external demand rather than a strong Singapore dollar. Hence, a weaker Singapore dollar, as suggested by Mr Wang, is unlikely to provide much of a boost to Singapore’s exports.
3 At the same time, still-elevated international prices continue to pass through to consumer prices in Singapore. The sustained strengthening of the Singapore dollar has dampened these price pressures and helped to bring down MAS core inflation from its peak of 5.5 per cent year-on-year in January 2023 to 3.3 per cent in October.
4 MAS carefully assesses the outlook and risks to both inflation and growth when formulating its exchange rate policy. The reduction in inflation has been achieved without undue pressure on economic growth. Domestic demand has held firm, and the unemployment rate remains low.
Director (Corporate Communications)
Monetary Authority of Singapore