ASEAN KEY DESTINATIONS
Singapore raises inflation forecast
Consumer prices may climb 4 percent to 5 percent in 2011, higher than a previous estimate of 3 percent to 4 percent, Ravi Menon, the managing director of the Monetary Authority of Singapore, said at a press briefing in the city state today. He reiterated a prediction for an expansion in gross domestic product of 5 percent to 7 percent.
Singapore’s economy shrank last quarter as manufacturing slumped, adding to signs of slower growth in Asia after the region led the global recovery from the 2009 recession. Europe’s debt woes and rising U.S. joblessness threaten demand for exports from Asia and have wiped about $2 trillion off stocks worldwide since the beginning of May.
“The ongoing sovereign debt crisis in the euro zone periphery poses significant risks -- both to global economic growth and financial stability,” the central bank said in its annual report released today. “Asia is facing rising inflation, caused primarily by higher oil, food and other commodity prices but also tighter labor markets. MAS will remain vigilant against this range of potential vulnerabilities.”
The Singapore dollar has reached unprecedented levels since the central bank said in April it would allow further appreciation to tame price gains, the third monetary policy tightening in a year. It rose for a fourth day today against its U.S. counterpart, reaching a record S$1.2120.
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