SINGAPORE - The Monetary Authority of Singapore (MAS) said on Monday it would maintain its monetary policy stance of a "modest and gradual appreciation" of the Singapore dollar against the currencies of its main trading partners, even as it lowered its forecast for this year's inflation.
In its semi-annual monetary policy review, the central bank said this stance is "appropriate" for keeping both domestic and imported inflation in check.
It will also help ensure stable prices in the medium-term as a basis for sustainable growth, the MAS added.
The central bank also cut its forecast for inflation this year to between 1.5 and 2.5 per cent, from its previous tip of between 2 and 3 per cent.
This is on the back of a "large supply of newly-completed housing units", which are expected to help stabilise home values and imputed rentals. Imputed rentals are an estimate of how much a household would have to spend on rent if they did not own the house they live in.
However, the MAS is keeping its forecast of core inflation, which excludes private road transport and accommodation costs. It expects core inflation to rise 2 to 3 per cent this year, up from 1.7 per cent last year.