Liang Eng Hwa on Monetary Authority of Singapore (Amendment) Bill
Singapore has always been an attractive destination for foreign investments, said MP Liang Eng Hwa in Parliament on Tuesday (Jan 11). In order to manage the Singapore dollar within a tolerated trade-weighted band, the Monetary Authority of Singapore (MAS) would often need to intervene in foreign exchange markets to moderate the rise of the Singapore dollar. As a result, it accumulates a growing size of foreign currency, known as the Official Foreign Reserves (OFR). Mr Liang said to many jurisdictions, this would be a "happy problem" as it demonstrates the international markets' confidence in the Singapore economy. But Singapore needs to manage a couple of related issues. Firstly, how much of OFR does MAS need to hold to conduct monetary operations effectively and ensure price and market stability. Secondly, how can it derive decent returns from these accumulated funds in foreign currency.
Singapore has always been an attractive destination for foreign investments, said MP Liang Eng Hwa in Parliament on Tuesday (Jan 11). In order to manage the Singapore dollar within a tolerated trade-weighted band, the Monetary Authority of Singapore (MAS) would often need to intervene in foreign exchange markets to moderate the rise of the Singapore dollar. As a result, it accumulates a growing size of foreign currency, known as the Official Foreign Reserves (OFR). Mr Liang said to many jurisdictions, this would be a "happy problem" as it demonstrates the international markets' confidence in the Singapore economy. But Singapore needs to manage a couple of related issues. Firstly, how much of OFR does MAS need to hold to conduct monetary operations effectively and ensure price and market stability. Secondly, how can it derive decent returns from these accumulated funds in foreign currency.
Popular Shows
