MAS’ next decision may say more about growth than costs

BY THE end of July, the Monetary Authority of Singapore (MAS) will put out its usual quarterly monetary policy statement: tightening, loosening or maintaining current settings. Whatever the decision, it may be for quite different reasons than assumed a month or two ago.

When the previous monetary policy statement was released in mid-April, news sites were still running daily live blogs on the Strait of Hormuz. With the US and Israel’s war on Iran just into its second month, hopes for a short-lived conflict had ebbed, and fears of an energy crisis were high.

As MAS noted at the time: “Shipping through the Strait of Hormuz has been severely constrained since late-February, and worldwide prices of crude oil, natural gas and related chemical compounds have risen sharply.”