NEER Falls As MAS Keeps Monetary Settings Unchanged

The SGD NEER (per Goldman Sachs estimates) is weaker today as MAS left monetary policy unchanged, this is the first pause since October 2021. We now sit ~1% below the top of the trading band.

• MAS now sees Core CPI at 3.5-4.5% in 2023, and sees headline CPI at 5.5-6.5%. MAS sees core inflation easing materially by the end of 2023, also noting there are upside and downside risks to inflation. GDP growth in 2023 is seen at 0.5-2.5%
• MAS noted after 5 policy increases that whilst inflation is elevated the momentum of price increases has been tempered.
• Q1 Advance GDP printed at 0.1%, below the expected 0.6%.
• USD/SGD dealt a high of $1.3276 in the aftermath of the release, before paring gains to sit at $1.3245/55 ~0.2% firmer.
• Bulls now target the 20-Day EMA at $1.3307.