MAS tightens policy as oil price shock lifts inflation outlook

Singapore’s central bank today tightened monetary policy and raised its inflation forecast for this year in response to the crisis in the Middle East and the resulting surge in global energy prices. However, with the crisis expected to weigh heavily on economic activity – and with inflation having been low prior to the shock – we expect the Monetary Authority of Singapore (MAS) to remain cautious about further tightening at upcoming meetings this year.