SINGAPORE, May 29 (Xinhua) -- The Monetary Authority of Singapore (MAS) on Wednesday issued a release in response to media queries on the U.S. Treasury Report on Macroeconomic and Foreign Exchange Policies (UST Report), saying that it does not manipulate its currency for export advantage.
The MAS reiterated that Singapore's monetary policy framework, which is centered on the exchange rate, has always been aimed at ensuring medium-term price stability, and will continue to do so.
"As pointed out in the UST Report, MAS manages the Singapore dollar nominal effective exchange rate (S$NEER) within a policy band, just as other central banks conduct monetary policy by targeting interest rates," the authority said in the release. "Whether they target the exchange rate or the interest rate, central banks aim to keep consumer price inflation low and stable as their primary mandate."
The MAS said that it does not and cannot use the exchange rate to gain an export advantage or achieve a current account surplus, and a deliberate weakening of the Singapore dollar would cause inflation to spike and compromise MAS' price stability objective.
The MAS assesses that together with rising affluence that will raise consumption, Singapore's current account surplus will be reduced when public and private savings are drawn down for the needs of an ageing population, according to the release.
