SG Morning Highlights | MAS Keeps Monetary Policy Unchanged as Expected; Expects Full-Year GDP at 2-3%

Advancers / Decliners is 107 to 81, with 115.46 million securities worth S$116.91 million changing hands.

Singapore's central bank, the Monetary Authority of Singapore (MAS), announced on Friday (Jul 26) that it will maintain its monetary policy settings for the fifth consecutive meeting. This decision was in line with market expectations. Additionally, the MAS forecasts that gross domestic product (GDP) growth will likely come in at the higher end of the Ministry of Trade and Industry's forecast range of 1 per cent to 3 per cent for the full year. Specifically, the MAS predicts that GDP growth will be closer to its potential rate of 2-3 per cent. In terms of inflation, the MAS lowered its full-year forecast for headline inflation to a range of 2 per cent to 3 per cent, while maintaining its core inflation forecast range at 2.5 per cent to 3.5 per cent.

According to JTC's quarterly market report released on Thursday (Jul 25), prices and rents for industrial space in Singapore increased in the second quarter of 2024. However, while rents continued to rise, rental growth slowed. Industrial rents increased by 1% quarter on quarter (qoq) in Q2, which was lower than the 1.7% rise in Q1. On the year, Q2 rental growth was 6.6%. JLL's Head of Research and Consultancy, Chua Yang Liang, was not surprised by the slowdown in the rental index. He stated: "On a quarterly basis, the index has been shifting to a low gear since Q2 2023. This latest quarter's growth of 1%, the slowest in 10 quarters, was dragged down by weakness in the business parks and warehouse segments, despite the upside of 1.5% rental growth qoq for multiple-user factory space."

On Thursday (Jul 25), Singapore's Ministry of Trade and Industry (MTI) announced that Singapore and the European Union (EU) have successfully completed negotiations on a digital trade agreement that will enhance data flows and digital trade between the two regions. This EU-Singapore Digital Trade Agreement (EUSDTA) is the first of its kind between the EU and an ASEAN country, and marks the fifth digital economy agreement that Singapore has concluded, following similar treaties with Australia, South Korea, the United Kingdom, and a joint agreement with Chile and New Zealand.

On Thursday (Jul 25), Singtel's data centre arm, Nxera, and Telkom Malaysia (TM) announced the groundbreaking of a data centre campus in Iskandar Puteri in Johor. The campus will house a 65 megawatt (MW) data centre that will support artificial intelligence processing and other computing needs. The facility is expected to commence commercial operations in 2026 and will be a Tier 3 data centre with redundant cooling and power to minimise downtime. Bill Chang, Chief Executive Officer of Nxera and Singtel's Digital InfraCo unit, expressed confidence in the project and stated: "When completed in 2026, the project, located within the Johor-Singapore Special Economic Zone, will boost high-quality digital infrastructure."