Hidden Bibliographic Details
| Other authors / contributors: | International Monetary Fund.
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| ISBN: | 9781475515152
1475515154
9781475520743
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| Notes: | Online resource; title from PDF title page (ebrary, viewed January 19, 2014).
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| Summary: | This Selected Issues Paper discusses some observations on Singapore's monetary policy framework. Singapore's monetary policy uses the nominal effective exchange rate (NEER) as the instrument in a basket-band-crawl framework. The paper finds that under some conditions an exchange rate-based monetary policy may not be detrimental to external competitiveness. A key parameter is the weight of imports in the consumer basket or production function. Tightening monetary policy through a nominal appreciation helps to dampen imported cost pressures. In addition, nominal appreciation can reduce domestic sources of inflation by lowering demand for local factors of production.
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