- In July 2026, the Monetary Authority of Singapore (MAS) tightened its monetary policy for a second consecutive time due to a renewed surge in oil prices and inflation risks.
- The MAS will increase the rate of appreciation of the policy band very slightly, with the adjustment being smaller than that in April.
- Singapore's core inflation rose to 1.6% in June from 1.4% in May, indicating potential inflationary pressures.
- Crude oil prices climbed back above $100 a barrel following attacks on Saudi tankers, exacerbating supply threats.
Singapore's Monetary Authority of Singapore (MAS) has tightened its monetary policy for the second consecutive time, responding to a surge in oil prices that rekindles inflation risks.1
The MAS announced a slight increase in the rate of appreciation of the Singapore dollar's nominal effective exchange rate policy band, although the adjustment is smaller than that made in April.
Singapore's core inflation, which excludes accommodation and transportation costs, rose to 1.6% in June from 1.4% in May, remaining within the MAS's forecast range of 1.5%–2.5% for the year. Headline inflation stood at 1.9%.4
The tightening comes as crude oil prices climbed back above $100 a barrel following attacks on Saudi tankers, raising concerns about imported-cost pressures. The MAS noted that these pressures typically pass through to broader consumer prices with a lag, indicating that inflation may rise in the coming months.5
Despite these inflationary pressures, Singapore's economy showed resilience, with GDP growth recorded at 5.7% year-on-year in Q2 2026, surpassing the 5.5% median estimate in a Reuters survey and exceeding the government's full-year projection of 2%–4%.
The MAS's proactive measures reflect Singapore's vulnerability due to its near-total reliance on imported energy, making it susceptible to fluctuations in global oil prices.
“The MAS increased the rate of appreciation of the policy band very slightly, a smaller move than April's, as core inflation ticked up to 1.6% in June. Meanwhile, crude climbed back above $100 a barrel after Houthi attacks on Saudi tankers deepened supply threats.”
CNBC
