MAS Policy Framework Keeps SGD Resilient Amid Global Volatility
The Monetary Authority of Singapore's (MAS) policy stance has been a key factor in the relative resilience of the Singapore dollar, according to an analysis by MUFG Bank. As early as 2025, the SGD has maintained a stable trajectory against the US dollar, despite other regional currencies experiencing more pronounced volatility.
MAS's unique policy framework differs from most central banks, which adjust interest rates. Instead, it manages monetary policy by setting the slope, width, and center of the Singapore dollar's nominal effective exchange rate (S$NEER) policy band, directly targeting the currency's trade-weighted value.
The MAS's decision to maintain a slightly appreciating slope for the policy band, despite easing global inflationary pressures, signals its commitment to price stability, bolstering investor confidence in the SGD.