SINGAPORE (Reuters), Singapore’s economy is expected to continue its recovery in the third quarter, but global spread of Delta coronavirus has cast doubt on the outlook. A Reuters poll revealed that this will prompt the central banks to keep their hands on the controls.

11 of 13 economists believe the Monetary Authority of Singapore (MAS) will not make any adjustments to its policy settings for Oct. Two economists expect that the MAS will tighten and normalize its policies in line with those of other central banks.

A second poll found that analysts expected the economy to continue expanding, albeit at a slower pace in the third quarter.

On Thursday, preliminary data may reveal that the economy increased 6.6% compared to 14.7% the preceding quarter. The milder low-base effects, and the stricter curbs after the rise in COVID-19 case, are some of the reasons.

We believe manufacturing and financial services have held up well, while some contact-intensive segments like retail/wholesale or food/lodging may have suffered more. Morgan Stanley According to economists (NYSE:), the report was released last week.

Singapore has now fully vaccinated approximately 83% its population of 5.45million people, however it has placed some restrictions on coronavirus to allow for time and preparations to deal with the disease.

This year’s expected growth is between 6% and 7% for the trade-dependent economy. It was hit hard by last year’s COVID-19 epidemic. The government announced on Saturday that it would open borders to additional countries in order to allow quarantine-free travel. This is a significant step toward restoring international connections.

Strong electronics sector performances have made manufacturing a major pillar of this country’s recent growth.

The core inflation rate in Singapore – which is the central bank’s preferred price measure – reached a 2-year high of 1.1% August. However, economists anticipate prices to remain benign for the near-term and slowly rise.

The MAS expects core inflation to average 0–1% this year.

Central banks manage monetary policies through exchange rate setting, not interest rates. The local currency is allowed to fluctuate against its trading partners’ currencies within an unknown band.

The MAS shifted the centre of its band lower in March 2020. This was its largest easing action since 2009’s financial crisis.

The majority of analysts believe that the MAS will stay prudent and maintain the same slope, width, and mid-point for the policy band. However, many analysts believe the central bank may sound more hawkish than usual to make markets ready for tightening in its April 2022 meeting.

(Polling by Chen Lin, Vivek Mishra in Singapore, Devayani Sathyan, and Md Manzer Hussain, Bengaluru; Writing By Aradhana Aravindan, Editing by Sam Holmes