In a parliamentary reply, Minister for National Development and Monetary Authority of Singapore Deputy Chairman Chee Hong Tat, responding on behalf of MAS Chairman Gan Kim Yong, assessed Singapore’s borrowing costs and credit conditions as broadly stable despite sustained increases in US Treasury yields. The 10-year Singapore Government Securities yield was 2.5%, compared with a 10-year average of about 2.2%, while its discount to the 10-year US Treasury yield widened from about 170 basis points in January 2025 to about 250 basis points in September 2026. Three-month Compounded SORA was about 1.2%, below its 10-year average of 1.5%, with firm credit growth, sound credit quality and well-capitalized banks. MAS stress tests indicate that households and businesses generally remain able to manage higher borrowing costs. Housing loan safeguards include a 55% Total Debt Servicing Ratio cap, a 30% Mortgage Servicing Ratio cap for specified public housing purchases and bank affordability assessments based on a 4% interest rate. About 60% of Housing and Development Board households with outstanding loans have concessionary loans pegged to the Central Provident Fund Ordinary Account interest rate, reducing their exposure to movements in market mortgage rates. The government increased its risk share for eligible Enterprise Financing Scheme loans from 50% to 70% in September 2026 to improve access to working capital and project financing, and stands ready to provide targeted support if needed. Singapore’s reserves are managed over a long-term horizon and diversified across asset classes, making a gradual increase in yields manageable at the portfolio level.
Monetary Authority of Singapore finds borrowing costs and credit conditions remain sound despite higher US Treasury yields
The Monetary Authority of Singapore assessed domestic borrowing costs and credit conditions as broadly stable despite higher US Treasury yields, with the 10-year Singapore Government Securities yield at 2.5% and three-month Compounded SORA at 1.2%. Stress tests indicate that households and businesses generally remain able to manage higher borrowing costs, supported by housing loan safeguards. The government has also raised its risk share for eligible Enterprise Financing Scheme loans from 50% to 70%.