Insight - How should central banks manage pandexit?

Lee Heng Guie executive director of the Socio Economic Research Centre:"We reckon that an accommodative monetary stance is still needed, but it has to be pragmatic and prudent. The rollback of monetary stimulus, including the normalisation of interest rate path must be appropriately timed. The future path of interest rate normalisation will require clear and predictable policy communication to smoothen the ride."

CENTRAL banks, after all their ultra-monetary stimulus and liquidity injection to stem the pandemic-induced economic recession in 2020, face many challenging tasks ahead as the global recovery gains traction.

While ensuring that the global recovery is sustained, central bankers have to anchor inflation expectations and address the risk of financial vulnerabilities building up.