MAS: Policy slope hike and inflation focus – DBS

DBS Group Research expects the Monetary Authority of Singapore (MAS) to slightly increase the slope of the Singapore Dollar (SGD) Nominal Effective Exchange Rate (NEER) policy band at its 14 April meeting, reversing last year’s easing. The bank sees policy priority shifting toward imported inflation as Brent stays near USD100 and exports remain resilient. MAS is also expected to lift its core and headline inflation forecasts alongside strong but moderating 1Q26 GDP.

Slope normalisation and inflation upgrade

"We anticipate the MAS will slightly increase the slope of the SGD NEER policy band in its April 14 statement."

"We view this move as a normalisation that reverses last year’s slope reduction to combat a higher global inflation landscape driven by the Middle East conflict."

"With Brent crude prices firmly elevated around USD100 per barrel, and exports maintaining resilience, the policy priority has pivoted toward addressing imported inflation before it de-anchors underlying price expectations."

"To reflect this, we expect the MAS to raise its core inflation forecast to 1.5-2.5% (from 1-2%) and the CPI-All Items projection higher to reflect the current energy shock."

"Also to be released concurrently with the MAS's policy decision are the 1Q26 advance GDP estimates, which we expect to register at 5.4% yoy (-1.1% qoq sa), compared with 6.3% yoy (2.1% qoq sa) in 4Q25."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)