Major banks and insurers are accelerating their digital transformation and ramping up hiring in application development, data science, and artificial intelligence. Example: OCBC Bank recently announced that it plans to hire 1,500 technology staff over the next 3 years, with the majority of those positions to be based in Singapore. Bank of America has based one of its two overseas global cyber security centres in Singapore. The bank currently has more than 800 headcounts in Singapore focusing on technology. Another example is Shanghai Pudong Development Bank, which set up its first overseas innovation centre in Singapore. Likewise, global insurers like SCOR have established innovation labs in Singapore. Local insurers have invested heavily in technology too. Singapore has made a name for itself as providing one of the world’s most conducive environments for financial innovation. We are now home to over 50 global and regional innovation labs and more than 1,400 FinTech firms. Last year, we saw record high FinTech investments of $ billion last year, up from $ billion in 2020 [2] . Leading players at the forefront of digital asset innovation have anchored their operations in Singapore. JP Morgan has partnered DBS Bank and Temasek to establish Partior, which is a multi-currency, cross-border settlement platform, leveraging blockchain technology. R3, a global distributed ledger technology provider with roots as a banking consortium, has grown its innovation hub in Singapore to become the regional headquarters for Asia.
4  See the box ”Uncertainty regarding future interest rate movements”, in Inflation Report 2006:1. 4  BIS Review 33/2006  In the second method, the uncertainty interval is instead calculated with the aid of the market’s pricing of interest rate options. The current prices of interest rate options reflect expectations of future interest rates. This method is therefore forward-looking and based on the fact that the redemption price for identical options can vary. This variation reflects the market’s assessment of the uncertainty in the future price of the asset on which the option is based. Since this variation can be observed, it is possible to construct an uncertainty interval around the implied forward rate curve. These uncertainty intervals are largely similar to the uncertainty intervals based on historical deviations (see Figure 5). To summarise, the strategy for monetary policy is being maintained with the new interest rate assumption. We normally try to attain the inflation target within a two-year period and we take the real economy into consideration. However, monetary policy cannot as before be described by the simple rule of thumb that was based on the assumption of a constant repo rate. Instead the forecasts that are based on the assumption that the repo rate will follow implied forward rates are studied and assessed. It is the whole path of inflation and the real economy that is important in monetary policy decisions.