All these developments reflect Singapore’s ideal position for asset managers to deepen and broaden their activities in the Asian time-zone. Annual accounts 28. On our financial statements, MAS recorded a net profit of $ billion for the financial year. The profits comprised mainly interest income, as changes in the valuation of foreign assets and the foreign exchange effects of a stronger Singapore dollar largely offset each other. Total assets, including the Currency Fund, grew by $ billion during the year to $ billion at end-March 2008. 4  BIS Review 94/2008  Remaining vigilant 29. We need to remain vigilant in the face of a number of risks in the global economic and financial environment. We will continue to work closely with the industry to identify vulnerabilities and threats to financial stability through macro surveillance and stress testing. MAS’ work in the coming year will continue to be driven by our mission of supporting noninflationary economic growth, and fostering a sound and reputable financial centre. 30. Thank you. BIS Review 94/2008  5
Growth is anticipated to be low also next year and approach trend growth in 2001. Demand growth could be higher than expected, which would contribute to maintaining the pressure in the labour market. Employment is still high and near capacity level, while we see a tendency towards higher unemployment in sectors such as the construction and engineering industries. Chart 13 Unemployment rate. Per cent 6  6  5  5  4  4  3  3  2  2  1  1  0  0 80  82  84  86  88  90  92  94  96  98  Source: SSB Legg inn filadresse her  Inflation is expected to remain at around 2% for the next two years, with inflation rates of 2¼% this year, 2% next year and 1¾% in 2001. Chart 14 shows the key technical assumptions underlying Norges Bank’s projections. Short-term interest rates are assumed to move in line with market expectations, as reflected in forward rates in September (Chart 15). According to market expectations, the differential against European rates will narrow from the current level of a little more than 3 percentage points to around 1 percentage point at the end of 2001. The krone exchange rate is assumed to be NOK 8.30 against the euro throughout the projection period. Developments, as indicated by Norges Bank’s analyses, imply that there is little room for further decreases in interest rates.