Singapore wins top central bank award; Flug is governor of year

Singapore wins top central bank award; Flug is governor of year

06/02/19, 05:30 pm

(Feb 6): The Monetary Authority of Singapore was named central bank of the year for its strong track record of stability and push to develop the city state into a financial technology hub.

The annual award, adjudicated by Central Banking journal, cited the MAS’s property cooling measures, an upgrading of its regulatory and supervisory practices and a willingness to spur new technologies as reasons for the accolade. The Singapore central bank has an “enviable track record for monetary and financial stability” and is a “pioneer in creating a framework to facilitate next-generation technological and financial innovation,” it said.

Unlike most central banks, the MAS uses the exchange rate as its main policy tool, given Singapore’s heavy reliance on trade and the openness of its economy. The MAS tightened monetary policy twice last year by allowing the currency to appreciate, encouraged by steady economic growth.

Karnit Flug, Israel’s first woman central bank chief, was named governor of the year for delivering “major reforms” in banking and pushing for the creation of a financial stability committee during her five years at the bank. She succeeded Stanley Fischer in 2013, leading the Bank of Israel to cut its benchmark interest rate to a record 0.1% in March 2015, where it remained until after her departure late last year.

Though her monetary policy was steady, her relations with Prime Minister Benjamin Netanyahu and Finance Minister Moshe Kahlon were stormy. Flug frequently clashed with the government over tax policies and budgetary priorities, as well as foreign currency purchases that curbed the shekel’s strength.

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