Technology will reshape financial services in the next 10 years, much more profoundly than it has in the last 5 years. Sustainability will become an increasingly central focus for financial services as the world strives towards a low-carbon future. Jobs in financial services will transform, with growing skills requirements across multiple domains. Technology, Sustainability, and Jobs are three areas that MAS has focused on intensely in recent years, working closely with the financial industry. Over the last two years, MAS has put out about 70 reports, speeches, and media statements on just these three subjects. Together with our industry partners, MAS facilitates discussions and provides updates, on Technology through the Green Shoots series, and on Jobs through the Growing Timber series. And just three weeks ago, we issued our inaugural Sustainability Report which covered not only the Green Finance Action Plan for the financial industry but also MAS’ efforts to reduce its own carbon footprint and to make the Official Foreign Reserves more climate-resilient. So, important as these three areas are, I will not touch on them today. There will continue to be ample opportunities to talk about them in future. MAS’ FINANCIAL POSITION Before I wrap up, let me provide an update on MAS’ financial performance. The investment return from the Official Foreign Reserves was $ billion in FY2020/21. This comprised: Investment gains of $ billion, mainly from interest income and realised capital gains.
The future output sub-index of the global composite PMI recorded 67.1 in May, signalling strong expansion going forward. Asian businesses expect to share in the global recovery in the second half of the year. The corresponding reading for the Asia ex-Japan economies 4 stood at 60.3 in May, well above last year’s average of 53.2. The expected strengthening in momentum is due to two main factors: substantial policy stimulus in the US and brisk deployment of vaccines in the US and Europe. The strength of the rebound in the advanced economies should in turn provide a powerful tailwind for Asian economies, particularly those that are more actively engaged in global supply chains. Overall, the global economy is expected to expand by 5.8% 5 in 2021, after last year’s 3.0% contraction. 1/9  BIS central bankers' speeches  The global economy has probably already regained its pre-pandemic level of output. In fact, the global economy could potentially surprise on the upside. One, vaccination rates are rising in many advanced economies, allowing them to re-open earlier and more fully. Some of them may effectively suppress domestic transmission by the end of Q3 2021. Two, even if there are mobility restrictions on account of new outbreaks of the virus, businesses and households have become better at adapting to such restrictions. A review of the evidence by MAS 6 has found that economic activity has become less responsive to movement restrictions over time.