MAS keeps the Singapore dollar's rate of appreciation unchanged as core inflation reaches 2.1%
Serguey Asael Shinder2 min readThe Monetary Authority of Singapore (MAS) said in its Monetary Policy Statement of 14 October 2026 that it will maintain the rate of appreciation of the Singapore dollar nominal effective exchange rate (S$NEER) policy band, with no change to its width or to the level at which it is centred.
Starting point. In July MAS had raised the band's rate of appreciation very slightly. Since then the S$NEER has strengthened modestly within the upper half of the band. The current appreciating band, MAS says, will let the currency keep strengthening and lean against the expected near-term rise in imported inflation.
Growth. Singapore's GDP grew 5.4% year on year in the third quarter, according to advance estimates, led by technology-related sectors; quarter on quarter, seasonally adjusted growth was 1.1%, slightly slower than in the second quarter. MAS expects AI-related activity to stay strong in the near term and moderate in the second half of 2027, and the positive output gap to narrow next year. Official GDP forecasts for 2026 and 2027 will come in November.
Inflation. MAS Core Inflation rose to 2.1% in July–August from 1.5% in the second quarter, as higher import costs fed through to electricity and gas tariffs, fuel-intensive transport and food. Services inflation came in lower than projected thanks to larger healthcare subsidies and telecoms price competition. Energy prices have risen again since September, so core and headline inflation are expected to stay at current slightly elevated levels in the months ahead before easing more noticeably from mid-2027.
Forecasts. For 2026, MAS Core Inflation is forecast at 1.5–2.0% and CPI-All Items at about 2.0%; for 2027, both at 1.5–2.5%. Risks to inflation remain tilted to the upside — a renewed surge in energy or food prices, or a broadening of the AI boom into faster labour-cost growth — while sharper rate rises, an AI investment pullback or a faster recovery of Middle East energy supply would push the other way.
Source: Monetary Authority of Singapore, "MAS Monetary Policy Statement - October 2026" — https://www.mas.gov.sg/news/monetary-policy-statements/2026/mas-monetary-policy-statement-14oct26