Singapore: Financial Sector Assessment Program; Technical Note-Macroprudential Policy

IMF Staff Country Reports, July 15, 2019

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Canonical URL: Singapore: Financial Sector Assessment Program; Technical Note-Macroprudential Policy

Evaluates the macroprudential policy framework in Singapore with a focus on the price effect of macroprudential instruments.
Assesses:
- domestic institutional arrangement,
- systemic risk monitoring framework,
- macroprudential policy toolkit.
Discusses the use of macroprudential instruments in recent years and their effects on residential prices.

The institutional framework for macroprudential policymaking has been revised and contains a clear mandate and well-defined objectives.
The macroprudential mandate is assigned to dedicated committees within Monetary Authority of Singapore (MAS), limiting risk of dual mandates for the central bank.
The authorities have taken important steps in recent years to develop the macroprudential policy framework and address relevant recommendations.
Findings on strengths and weaknesses:
- Strengths: clear mandate, well-defined objectives, dedicated committees within MAS.
- Weaknesses: (assessment identifies areas for enhancement; specific recommendations are provided in the note).

Reviews the macroprudential policy toolkit available to Singaporean authorities.
Analyzes the price effect of macroprudential instruments on residential prices.
Documents the use of macroprudential instruments in recent years and their observed effects on residential prices.

Provides recommendations on how to enhance institutional arrangements for macroprudential policymaking.
Provides options to strengthen the systemic risk monitoring framework.
Recommends measures to refine the macroprudential toolkit and its deployment to influence housing market dynamics and prices.