Singapore's central bank has tightened monetary policy in response to rising oil prices that have rekindled inflation risks, according to CNBC.
Key facts
- The Monetary Authority of Singapore (MAS) has tightened monetary policy, according to CNBC.
- CNBC reports the move follows rising oil prices that have renewed inflation concerns.
- The MAS manages medium-term price stability by managing the Singapore dollar exchange rate.
- The exchange rate is managed against a trade-weighted basket of currencies.
The Monetary Authority of Singapore (MAS) has tightened monetary policy as rising oil prices rekindle the risk of inflation, according to CNBC.
Unlike most central banks, the MAS manages medium-term price stability by managing the Singapore dollar exchange rate against a trade-weighted basket of currencies, according to CNBC.
Further details of the policy adjustment, including its specific parameters, were not provided in the source.
Why it matters
The MAS's use of the exchange rate rather than interest rates makes its policy approach distinct from that of most central banks, according to CNBC's account of its framework.
Frequently asked questions
How does the Monetary Authority of Singapore manage inflation?
According to CNBC, the MAS manages medium-term price stability by managing the Singapore dollar exchange rate against a trade-weighted basket of currencies, rather than primarily adjusting interest rates like most central banks.
Why did Singapore tighten monetary policy?
According to CNBC, the MAS tightened policy because rising oil prices rekindled the risk of inflation.