ravi menon : shanghai and singapore - financial centre partnership panel remarks ( via video conference from singapore ) by mr ravi menon, managing director of the monetary authority of singapore, at lujiazui forum 2020, 18 june 2020. * * * china - singapore financial co - operation let me first congratulate the shanghai municipal government for successfully convening the lujiazui forum while the world is still grappling with the covid - 19 pandemic. singapore is honoured to be the lujiazui forum ’ s partner city this year. covid - 19 has unleashed not only an economic crisis but also a growing fragmentation of the global economy. this is a threat facing the whole world. but the countries in asia are well placed to lead the global economic recovery and forge new channels of cooperation and integration. finance can play a key role in facilitating this economic recovery and integration. china and singapore can help to blaze a new trail in financial cooperation and innovation in asia. 2020 marks the 30th anniversary of the china - singapore bilateral relationship. financial cooperation has been a highlight of this relationship. we have made good progress in three areas. first, growing the offshore rmb market. since 2013, with icbc being appointed as rmb clearing bank in singapore, this has helped to promote greater use of rmb in the region. singapore is the largest offshore centre for rmb deposits and rmb trade finance and second largest for rmb foreign exchange trading, outside greater china. second, enhancing the links between our capital markets. the monetary authority of singapore ( mas ) and the people ’ s bank of china ( pbc ) are looking to enable designated banks in singapore to offer custody and trading services for global investors in china ’ s bond market. third, providing opportunities for our financial institutions to grow in each other ’ s markets. the bank of china and icbc are among the select group of nine qualifying full banks in singapore ; five chinese banks are licensed as wholesale banks. all three singapore - headquartered local banks are incorporated in china. the shanghai - singapore connection within this broader canvass of financial co - operation, the ties between shanghai and singapore have been intensifying. singapore banks are deepening their partnerships in shanghai – dbs and shanghai pudong development bank in loan syndication and joint bond underwriting ; ocbc and bank of shanghai in digital banking and supply chain financing ; 1 / 3 bis central bankers'speeches uob and shenergy group in establishing a consumer finance corporation.

the past year was indeed intended to break a self - sustaining inflationary psychology. households ’ and firms ’ inflation expectations have peaked, supporting this assessment. our latest monthly business survey, released a week ago v, shows that business page 8 sur 13 leaders are adapting their selling prices accordingly. for the first time in august, the share of industrial firms that have decreased their selling prices ( 6 % ) is larger than the share of firms that have increased them ( 4 % ). … but risks to be rightly assessed however, the criticism that we have done too much misses two points in my opinion. it somewhat overestimates the risks to growth : what we presently see – and forecast – is a slowdown, not a recession ; and employment remains at record highs, which is a positive surprise. and it underestimates the persistence of inflation. headline inflation has indeed come down rapidly. but regarding underlying inflation, the news is less clear - cut. the hicpx rose to 5. 7 % in march this year but fell back to 5. 3 % in august. in the eurosystem, we look at a battery of indicators and those that try to identify instant inflation are lower than this, below 3 % ; they all point in the right direction. nevertheless, annual nominal wage growth remains sustained, although showing early signs of peaking : it is page 9 sur 13 forecasted to reach in average 5. 3 % in the euro area in 2023, and 4. 3 % and 3. 8 % respectively in 2024 and 2025. furthermore, some commentators talk about “ the difficulty of the last mile ” in the return of inflation back to the 2 % target. however, this phrase supposes nonlinearities in the phillips curve, which have not been really identified in the european case. and some suggest that as a result we should accept that “ nearenough ”, say 3 %, is close enough to target rather than set a much tighter policy in the pursuit of 2 %. i am not fixated on 2. 0 % to the nearest decimal place, but i do believe that it would be very counterproductive to change or relax our inflation target, either explicitly or implicitly. one lesson about the future just like the criticism about the past, this unwarranted criticism can nevertheless serve a useful lesson. the risk is not that we have already done too much. it is possibly that we could do too much in the future. let me elaborate