"Inflation Surges in October, Prompting Expectations of Prolonged Monetary Policy Pause by MAS into 2024

Inflation picks up more than expected in October

✕Elevated inflation points to MAS extending pause well into 2024

With the latest rebound in inflation and still elevated risks to the inflation outlook, we expect the MAS to extend its pause well into 2024. With the MAS announcing it will be meeting four times beginning next year, we believe the central bank will have more flexibility to react to changes in the inflation and growth outlook. 

Despite today’s pickup in both the headline and core inflation readings, the central bank still expects inflation to cool in 2024. If we see core inflation head back closer towards the 2% level, we believe the MAS could consider adjusting its current stance in the second half of 2024.