The central bank of Singapore tightened its monetary policy in April, 2018. This was the first such move since 2012. For the last three years, the Monetary Authority of Singapore had held a neutral stance. Many economists were in favor of such a neutral stance although there were others who wanted a tighter monetary policy, especially since the economy has shown signs of steady recovery and subsequent growth in the last one year. This is reflected in the gross domestic products figures. Exports are on the rise, having a direct impact on the value of the Singaporean dollar. Inflation has been healthy for many months now.

It should be noted that the Monetary Authority of Singapore uses the dollar and its valuation vis-a-vis major currencies as the primary tool to determine its core policy. While tightening the monetary policy, the autonomous authority has also expanded the currency band. However, there …