Questioning the toll of a stronger Singapore dollar on export competitiveness and growth

While the MAS's tighter policy aims to curb inflation, the second consecutive quarter of currency appreciation raises serious concerns for Singapore's trade-dependent economy. A stronger Singapore dollar makes exports more expensive, eating into the margins of manufacturers and service providers who compete globally. Sectors like electronics, precision engineering, and pharmaceuticals could see slower demand as their products become pricier in foreign markets. For these industries, the currency move comes at a challenging time when global trade is already under strain from geopolitical tensions and slowing growth. Moreover, the persistent inflation that MAS is fighting may not be entirely demand-driven but rather supply-side, making currency appreciation a less effective tool. Higher import costs from the Iran conflict are largely beyond MAS's control, and a stronger dollar cannot fix supply chain bottlenecks. There is also a risk that over-tightening could tip the economy into a slowdown, hurting jobs and wages. For everyday Singaporeans, the stronger dollar may reduce import prices, but it also dampens wage growth and business confidence. Small and medium-sized exporters, which form the backbone of local employment, may find it harder to sustain profitability. MAS should consider whether a more balanced approach, perhaps holding off further tightening until inflation trends are clearer, would better support both price stability and economic vitality.