By Chun Han Wong and Martin Vaughan
SINGAPORE--Capital flows into Singapore have receded in recent months
as investors shifted assets back to developed markets, but the
government remains wary of any resurgence in short-term capital
inflows and the impact this may have on local asset markets, a
government minister said Monday.
"We cannot rule out Singapore seeing a resurgence of capital inflows
given our strong macroeconomic fundamentals," Lawrence Wong, minister
of state for education and defense, said in Parliament in response to
a lawmaker's question.
"The impact of foreign money flows on the property market has been a
concern," said Mr. Wong, who is also a board member of the Monetary
Authority of Singapore. "We will continue to the monitor closely the
impact of capital inflows on the domestic economy, and especially on
our asset markets, to ensure that these flows do not threaten the
stability of the financial system or the property market."
Separately Monday, another government minister noted that the
strengthening of Singapore's currency has created some challenges for
local businesses, but added that the government doesn't currently see
severe foreign-exchange impact on the city-state's export
competitiveness.
"If you look at the exchange rate movement in general, whilst it has
posed some challenges to our businesses, at the same time our export
performance continues to be there in positive territory," S. Iswaran,
the second minister for trade and industry, said in Parliament in
response to a lawmaker's question.
The competitiveness of Singapore's exports remains more a function of
external demand and other macroeconomic factors, rather than just
foreign-exchange rates, Mr. Iswaran said.
Write to Chun Han Wong at chunhan.wong@dowjones.com and Martin Vaughan
at martin.vaughan@dowjones.com
(END) Dow Jones Newswires
July 09, 2012 03:14 ET (07:14 GMT)
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