MAS Seen On Hold In 2024

Several banks update their viewpoints post yesterday's Singapore inflation Data. The bottom line is that the MAS is seen on hold this year, see below for more details. To recap, headline CPI rose 3.4% y/y, from 2.9% prior. Core inflation was 3.6% versus 3.1% prior.

HSBC: "All in all, today's inflation data is the last release before the MAS' next meeting due in mid-April. Despite some Lunar New Year distortions, all signs continue to point to the same direction that the MAS is in no rush to loosen its monetary policy. Similar to the US Fed, we believe the MAS will need to see more evidence that inflation is moving sustainably towards its comfort zone (slightly below 2%) before easing. Meanwhile, Singapore remains on a firm track for better growth prospects, thanks to the AI-powered upturn in the tech cycle (see: Singapore Trade, 18 March). This will also reduce the urgency for the MAS to start easing. Therefore, we expect the MAS to maintain a long pause over our forecast horizon through 2025."

Goldman Sachs: "Going forward, we expect inflation to remain elevated in March before easing to ~2% by the end of the year. Higher inflation in Q1 has mainly been driven by various seasonal holidays and one-off events. We continue to expect the MAS to keep its monetary policy parameters unchanged this year."