Yesterday, MAS released their monetary policy statement for the second half of this year.
With the risks weighted towards inflation, MAS will continue with the policy of a modest and gradual appreciation of the S$NEER policy band in the period ahead.
The slope of the policy band will be increased slightly, with no change to the level at which the band is centred. At the same time, the policy band will be widened slightly in view of the volatility across international financial markets.
The move runs contrary to what many other countries are doing, as they sought to slow down the rise in their own currencies.
The MAS underlying inflation measure, which excludes the cost of accommodation and private road transport, is expected to average around 2% in 2010 and 2-3% next year.
The economy recorded growth of 15.5% year-on-year in the first three quarters of this year. For 2010 as a whole, GDP is on track to grow by 13% to 15%.