MAS ready to curb excessive volatility in Singapore dollar after Brexit

SINGAPORE'S central bank said on Friday it is ready to curb strong fluctuations in the country's currency following Thursday's UK referendum that show Britain will leave the European Union (EU).

The Monetary Authority of Singapore (MAS) said while the Singapore dollar remained within its policy band, MAS was prepared to take action should there be market volatility in the wake of the UK's "Leave" vote, or "Brexit".

"MAS stands ready to curb excessive volatility in the Singapore dollar," said an MAS spokesman.

Results on Friday showed Britain had voted to break out of the EU.

Following the announcement of the referendum's results, the MAS spokesman said the central bank had been prepared for the market volatility should Brexit occur.

It had been in close contact over the past weeks with banks in Singapore, foreign central banks and regulators to take actions so that the resilience of Singapore's financial system and markets can be sustained.

MAS also noted that after Brexit was announced on Friday morning, "Singapore's interbank money markets continue to function in an orderly manner and its banking system remains sound".

"The liquidity positions of the major banks in Singapore are healthy, and overall banking system liquidity remains adequate. MAS will provide additional liquidity to the banking system if needed," said the spokesman.

"MAS will continue to be vigilant and stay in close contact with fellow central banks and regulators, as uncertainty is likely to persist following the referendum outcome," he added.

The British pound dived 6.5 per cent against the Singapore dollar to hit S$1.8085 as at 3.42pm Singapore time on Friday.

For more coverage of the EU referendum, visit bt.sg/BrexiT