Net trade on the other hand has performed less strongly; while it did support growth immediately following the referendum and in response to the  7  All speeches are available online at www.bankofengland.co.uk/news/speeches  7  accompanying depreciation, that boost has now come to an end, and slowing trade is now dragging on growth. Chart 7: G7 business investment  Chart 8: Business investment compared with previous recoveries Indices: peak in GDP = 100  Percentage changes on a year earlier  20  180  EU Referendum Act  15 160  10 5  140  0 120  -5  2008  100  -10 -15  80  -20 -25 2007  60 2009  2011  2013  G7 (ex. UK)  2015  2017 UK  0  5  10  15  20  25  30  35  40  Quarters since pre-recession peak in GDP  At the same time, business investment has been strikingly weak. Investment growth was already slowing ahead of the Brexit referendum (Chart 7). Following the referendum it has come to a complete stop. In fact the level of business investment has actually fallen slightly over the past three years – that is despite a supportive global environment and accommodative financial conditions that have supported growth in other countries, and in contrast to the 7%-plus annual growth we were forecasting ahead of the referendum.
It limited the extension of bank credit in Singapore dollars to non-residents except for economic activity, and buttressed this with some restrictions on interbank Singapore dollar derivatives, such as currency and interest rate swaps and options, which might have helped financial players to leverage or hedge their positions. This policy made it harder for would be speculators to short the Singapore dollar, and signalled unambiguously our disapproval of such speculation. This framework served us well. That we encountered very few speculative attacks in practice perhaps showed that the policy was effective. The strength and stability of the Singapore dollar instilled confidence and kept inflation low. Price stability provided the foundation for sustained economic growth, which in turn provided the basis for continued strengthening of the Singapore dollar. We benefited immensely from this virtuous cycle. Over the past two decades since 1981, the Singapore dollar has risen steadily by more than 70%, on a trade-weighted basis. Domestic inflation has been among the lowest in the world, averaging 2.0% per annum compared to 6.5% for the OECD countries. In real terms, GDP growth averaged 7.6% a year, while GDP per capita in 2000 was two and a half times the level in 1981. Financial supervision MAS’ second responsibility is oversight of the financial sector. MAS was an integrated supervisor long before this became internationally fashionable. When it was formed in 1971, MAS was responsible for both monetary policy and the supervision of banks.