Twice yearly, on the 2nd Friday of April and October, the Monetary Authority of Singapore (MAS) releases a concise  ‘Monetary Policy Statement’ to the public. In the two page release, the MAS announces its stance on the Singapore Dollar for the next six months and the considerations behind the decision. Unlike proclamations of growth for the economy that inevitably hogs the headlines for days on end, traders and investors tend to dismiss this announcement without much consideration. However, this little nugget of concrete information is much more important than growth figures. We examine Singapore’s Exchange Rate Policy in more detail. 1. Why do we need a Monetary Policy? Singapore is a small but open economy. We trade with many countries all over the world. The Singapore Dollar is the bedrock and the lifeline of this trade. Overseas companies wishing to purchase goods and services manufactured in Singapore will have to ......