6 There are several key factors to the improved prospects for the rest of the year. 7 First, the external environment remains generally favourable, with both major engines of global growth intact. •  In the US, recent data indicate continued economic expansion. Both manufacturing and services PMIs are up. The labour market continues to improve. There is also a modest rise in business spending, which is a key driver of growth in the US. •  In China, growth should come within the consensus range of 7–7.5%. There are some headwinds from ongoing structural reforms but targeted policy measures will provide support to the economy. 8 Second, sectors dependent on regional demand – such as financial intermediation services, business services, and chemicals – should do well. They will benefit from higher regional incomes as the pick up in exports bolsters domestic demand in Asia. 9 Third, domestic oriented sectors should stay resilient. The construction industry is supported by a pipeline of infrastructure projects while domestic corporate and consumer spending will lend support to the info-communications and other essential services such as healthcare and education. 10 However, there are downside risks to the growth outlook. This year, geopolitical risks are larger than macroeconomic risks. The MAS is closely monitoring the ongoing conflicts in the Middle East and Ukraine. Should the conflicts intensify or drag on, they could adversely impact confidence, generate financial market volatility, and increase global oil prices.
For these highly leveraged households, reducing the level of leverage will take time. They need to work with their banks and commit to debt repayment plans. 30 Hence on the whole, MAS’ assessment is that it is premature to ease property cooling measures now. It is important that we secure the gains we have made in stabilising the market and restoring financial prudence. Comprehensive measures to safeguard interests of consumers of financial products 31 On the financial regulatory and supervisory front, I will focus on measures being taken to safeguard the interests of consumers of financial products. 32 Several measures were announced recently and some will be announced soon. Let me set the context for these measures – motivating factors, overall approach, and how the various pieces fit together. 33 Three trends are shaping market for financial products. •  Low interest rates globally have spurred investors to seek better returns. •  Growing affluence and financial awareness have generated greater demand for a broader range of retail investment products. •  There has been an increased sophistication and variety in financial products offered to retail public. 34 Against this backdrop, MAS is taking a multi-pronged approach to safeguard consumer interests. First, we are enhancing regulatory safeguards for retail investors in unconventional investment schemes. Second, we will facilitate retail access to simple, lower cost products. Third, MAS will help to empower consumers with enhanced disclosure and information access. Fourth, we are raising standards of financial advice to consumers.