The Monetary Authority of Singapore (MAS) is set to announce its quarterly monetary policy decision by the end of July 2026. This upcoming decision is anticipated to provide more insight into the country's growth outlook than the previously expected focus on cost concerns.
In April 2026, MAS adopted a more hawkish stance by slightly increasing the rate of appreciation of the Singapore dollar nominal effective exchange rate (S$NEER) policy band. This move aimed to counter rising imported inflation driven by energy shocks and global supply disruptions. At that time, the central bank cited surging imported energy prices, particularly due to the Middle East crisis, and warned of broader import cost increases as physical crude oil shortages spread through the Asia-Pacific region.
However, recent developments suggest that the primary concern for MAS may shift from cost pressures to growth prospects. Preliminary data indicates that Singapore's economy expanded by 4.6% year-on-year in the first quarter of 2026, supported by manufacturing linked to the global AI capital expenditure cycle. Despite this robust growth, MAS expects a moderation in the remainder of 2026, citing higher energy costs and supply disruptions affecting major trading partners. Domestically, rising input costs are expected to pressure energy-dependent industries and dampen consumer demand. Nevertheless, resilient AI-related investment and steady public infrastructure and housing projects are anticipated to help stabilize growth.
Inflation forecasts have also been adjusted. MAS raised its 2026 projections for both core inflation and CPI-All Items inflation to 1.5%–2.5%, up from 1.0%–2.0% previously. This revision reflects stronger imported cost pressures, particularly from energy and related goods.
Given these developments, MAS's upcoming monetary policy decision is expected to provide more clarity on the central bank's assessment of Singapore's growth outlook and its approach to balancing growth and inflation concerns.