Singapore recession risk raises chance of policy easing
SINGAPORE: The growing risk of a recession in Singapore has raised the prospects of an off-cycle easing in policy, although for now the consensus among economists is for the central bank to sit tight in the hope the economy sparks to life.
Ten out of 15 economists polled by Reuters said their base prediction was for monetary policy to remain unchanged at the next review in April, 2017, similar to the no-change stance seen at last week’s meeting.
However, after the city state’s economy contracted sharply in the third quarter, with its services sector in recession and manufacturers hit by weak global demand, many analysts are hedging their bets. Four expect the Monetary Authority of Singapore to provide more stimulus, while one saw a 50-50% possibility. Of the 10 in the “no change” camp, four said the chances of further stimulus were rising. – Reuters