Singaporean consumer price inflation accelerates in November, core inflation to average 1.5 pct in 2017

Singaporean consumer price inflation accelerated to 0.6 percent year-on-year in November from October’s print of 0.4 percent. The rise was mainly driven by higher private road transport and accommodation inflation.

Services inflation accelerated to 1.6 percent in the month, owing to an increase in airfares, which was a reversal from the decline recorded in the previous month and a larger rise in telecommunications services fees and holiday expenses that more than countered the smaller rise in recreational & cultural services fees.

Meanwhile, food inflation remained unchanged from the previous month at 1.5 percent, as the rate of rise in prices for non-cooked food and food services was similar in both months. The overall cost of retail items recorded a smaller rise of 0.5 percent in the month. This greatly reflected a decline in the prices of personal care products, and a smaller rise in the prices of personal effects.

MAS core inflation, which strips the costs of accommodation and private road transport, remained the same at 1.5 percent, as a slower rate of rises in the prices of retail items countered higher services inflation.

According to MAS, Singapore’s imported inflation is expected to rise mildly, as global demand improves amid supply in key commodity markets. Global oil prices are likely to rise just marginally next year as compared to 2017. Global food commodity prices are also likely to rise modestly, even as localized shocks in regional supply sources might result in temporary fluctuations in domestic food prices.

“MAS Core Inflation is expected to be around 1.5 percent in 2017 and average 1–2 percent in 2018, while CPI-All Items inflation is projected to come in at around 0.5 percent this year and stay in the range of 0–1 percent next year”, stated MAS and MTI.

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