Currency Speculation and the Optimum Control of Bank Lending in Singapore Dollar: A Case for Partial Liberalization

Kenneth Chan and Kee Ngiam

No 1996/095, IMF Working Papers from International Monetary Fund

Abstract: The Monetary Authority of Singapore (MAS) has a long-standing policy of controlling bank lending in Singapore dollars to nonresidents and to residents who use the funds outside Singapore. While the control may prevent the internationalization of the Singapore dollar and contain exchange rate volatility, it can hinder the deepening and widening of the financial markets in Singapore. This paper suggests three policy options that would allow traders and investors to borrow Singapore dollars without any restrictions, while making it costly for speculators since their activities can cause exchange rate volatility which arguably imposes external costs to society.

Keywords: WP; Singapore-dollar loan; loan quota; MAS restriction; quota rule; credit facilities; government-linked companies; money market; loans to speculator; Loans; Currencies; Exchange rates; Bank credit; Currency crises; Global; Southeast Asia (search for similar items in EconPapers)
Pages: 34
Date: 1996-08-01
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=2069 (application/pdf)

Related works:
Working Paper: Currency speculation and the optimum control of bank lending in Singapore dollar: a case of partial liberalization (1996)
Working Paper: Currency Speculation and the Optimum Control of Bank Lending in Singapore Dollar: A Case for Partial Liberalisation (1996)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:1996/095

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().