Singapore’s Consumer Price Index (CPI) data for July has shown a continued easing of inflation, reinforcing the possibility of the Monetary Authority of Singapore (MAS) loosening its monetary policy. Market Analyst Josh Gilbert from eToro highlighted that the cooling inflation trend, coupled with anticipated moderated growth in the latter half of the year, supports the case for further easing in October as a precaution against potential growth risks.
Gilbert noted that whilst the MAS held its stance in July, the recent softer inflation figures suggest that inflation is no longer the primary concern it once was. “The conversation is shifting from bringing inflation under control to supporting growth,” he stated, indicating a potential change in focus for the central bank.
The analyst also drew parallels with the US Federal Reserve’s cautious approach, which has remained on hold this year whilst assessing tariff impacts. Gilbert pointed out that MAS has already eased monetary policy twice earlier this year, suggesting that allowing time for these measures to take effect whilst awaiting further clarity is a sensible strategy. However, he emphasised that the latest data makes it increasingly challenging for MAS to justify inaction.
As Singapore navigates these economic conditions, the upcoming decisions by MAS will be closely watched, with implications for both domestic growth and the broader economic landscape.
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