As Singapore's open economy makes it vulnerable to prices of foreign goods and money inflows which causes home prices to skyrocket, the Monetary Authority of Singapore (MAS) faces a complex challenge when it comes to constant inflation issues.
However, Trade and Industry Minister Lim Hng Kiang said the MAS has imposed measures to curb inflation, including the tightening of the property market, introducing measures to raise productivity and strengthening the Singapore dollar.
He noted that the country's monetary agency is "very concerned" about inflation, as the consumer price index remained at below five percent and core inflation was stuck at three percent.
NMP Tan Su Shan, Managing Director at DBS Bank, commented that a strong Singapore dollar helps control both domestic and imported inflation, although it could boost the amount of money in circulation and in turn cause asset inflation.
Lim acknowledged that this monetary concern is part of the "very complex environment that MAS has to deal with", adding that while MAS does not have an official inflation target, its objective is "to maintain price stability for sustained economic growth over the medium term".
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