Bank to maintain policy
The central bank unexpectedly announced it will leave monetary policy unchanged, seeking to curb consumer price gains even after the economy shrank an annualized 1.5 percent in the last quarter. “This policy stance is assessed to be appropriate in containing inflationary pressures and keeping the economy on a path of restructuring towards sustainable growth,” the Monetary Authority of Singapore said yesterday in a statement following its semi-annual exchange-rate review. There is to be no change to the slope and width of the local currency’s trading band that the MAS uses as its main policy tool, the bank said.
Yuan at balance rate: bank
The People’s Bank of China (PBOC) governor says the Chinese currency has reached its equilibrium rate and its value is mainly determined by the market, rather than intervention. In a speech delivered by one of his deputies, Zhou Xiaochuan (周小川), said yesterday that the central bank has refrained from intervening in the market in the past year. The US has long urged China to lift controls on foreign exchange markets that Washington contends keep the yuan undervalued. PBOC Vice Governor Yi Gang (易綱), who delivered the speech, said China knows that a fixed exchange rate is unsustainable and will continue with reforms.
Treasurer urges expansion
The global economy is relying too heavily on Asia to make up for stagnant growth in the US and Europe, said Australian Treasurer Wayne Swan, who urged international policy makers to do more to bolster expansion. “It is time for the other players to get off the benches and start to pull their weight on global economic growth again,” Swan said in remarks to the International Monetary and Financial Committee in Tokyo on Saturday, according to a transcript from his office. “Cutting fiscal positions on a sustainable footing needs to be done hand in hand with supporting growth — this does not need to be one or the other,” he said.
Bank to open office in SK
The World Bank plans to open an office in South Korea, according to an e-mailed statement from the Asian nation’s finance ministry. Jim Yong-kim, president of the World Bank, and South Korean Finance Minister Bahk Jae-wan are to sign a memorandum of understanding today to establish the office, according to the statement. The agreement also includes creating a new cooperation fund between the two partners, the finance ministry said in the statement. It did not specify when the office will open.
Minister warns on Greece
Finance Minister Wolfgang Schaeuble said yesterday that Greece would not default, but warned that if Athens did exit the eurozone it would be damaging not only for the zone as a whole, but also Greece. “I think, it will not happen that there will be a state bankrupt in Greece,” Schaeuble said at a meeting with business leaders in Singapore. “Greece has to take a lot of very serious reforms and this will harm. Everyone is trusting that the Greek government is doing what is necessary.” Greece is expected to agree a new austerity package with its lenders and for the EU and IMF to bridge their differences on how to cut the country’s debt by the time EU leaders meet on Thursday and Friday.