Thursday, November 13, 2008
Singapore has no interest rate policy, only FX policy. Interbank interest rates only tell part of the story because: i) banks prefer to get (much cheaper) funding from depositors, not from each other, ii) if banks decide to tighten lending, they don't just raise lending rates, they also stop lending to weaker borrowers. Watch overnight and term deposit rates and promotions to get an idea of liquidity and funding requirements of banks
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment