Singaporean headline inflation eases in November on steeper fall in private road transport costs

Singapore’s headline inflation eased in the month of November. CPI-All Items inflation decelerated to 0.3 percent year-on-year from October’s 0.7 percent rise. This was mainly driven by a steeper decline in private road transport costs that outweighed a slower rate of fall in accommodation costs.

Prices of services, retail items and electricity & gas also came in less, more than countering a slower rate of decline in accommodation costs. Private road transport costs dropped 3.6 percent year-on-year in November, steeper than the 0.6 percent fall in October, because of lower car prices in the midst of a fall in Certificate of Entitlement premiums, as well as a smaller rise in petrol prices.

Services inflation eased to 1.2 percent year-on-year in November from 1.4 percent, as a larger fall in telecommunication services fees and a more modest rise in holiday expenses outweighed a stronger rise in recreational & cultural services fees. The overall cost of retail items were up 1.1 percent year-on-year, easing from the 1.3 percent rise in October. This mainly shows lower inflation for telecommunication equipment, clothing & footwear items, household durables and medical products, which more than countered a larger rise in the prices of personal care products.

The cost of electricity & gas rose at a slower rate of 15.4 percent year-on-year in November, compared to the 16.6 percent rise in the preceding month.  The lower rate of inflation showed the impact of the phased nationwide launch of the Open Electricity Market on electricity prices. Food inflation came in at 1.4 percent year-on-year in November, unchanged from the previous month, as price rises for both non-cooked food items and prepared meals stayed widely the same.

Accommodation costs dropped 2.1 percent year-on-year, less than the 2.5 percent fall in October, on account of a more gradual decline in housing rentals, as well as a larger rise in the cost of housing maintenance & repairs.

MAS core inflation, which strips the costs of accommodation and private road transport, eased to 1.7 percent year-on-year in November, from 1.9 percent in the preceding month. The low rate was driven by lower services, retail and electricity & gas inflation.