Author: Faizal Bin Yahya, NUS

The global tightening of monetary policy in 2022 by central banks to curb excess liquidity and combat surging inflation has stirred fears about a global economic slowdown. Estimates from the International Monetary Fund forecast global growth falling to 2.9 per cent in 2023 from 3.4 per cent in 2022.

Highly trade-dependent economies like Singapore will be hardest hit by these monetary tightening measures. Singapore’s trade to GDP ratio was 336.86 per cent in 2022, an increase of 3.52 per cent from 2021.