[SINGAPORE] Singapore’s inflation nudged back down in May, driven by slower price increases in food and private transport, data from the Department of Statistics showed on Monday (Jun 23).
Core inflation, which excludes accommodation and private transport, was 0.6 per cent – in line with private-sector economists’ median forecast, according to a Bloomberg poll. It was also lower than the previous month’s reading of 0.7 per cent.
Headline inflation was 0.8 per cent, also in line with economists’ median forecast. May’s reading was also down from April’s 0.9 per cent.
On a month-on-month basis, core inflation was flat while headline inflation rose 0.7 per cent.
“Singapore’s imported inflation should remain moderate,” said the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) in a statement.
While global crude oil prices have risen in recent weeks, they are still close to the average in 2024. Meanwhile, food commodity price increases should stay contained.
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“Although the trade conflicts and the increase in global energy prices could be inflationary for some economies, their impact on Singapore’s import prices is likely to be offset by the disinflationary drags exerted by weaker global demand,” MAS and MTI added.
On the domestic front, labour costs are expected to rise gradually as nominal wage growth continues to ease. At the same time, enhanced government subsidies for essential services will continue to dampen services inflation.
MAS and MTI still expect core inflation to average 0.5 to 1.5 per cent in 2025. This is while they note that uncertainties have risen amid the increased risks in the external environment.
Key CPI categories
In May, most consumer price index (CPI) categories saw easing prices, except for accommodation and services inflation which was unchanged from the month’s before.
Food inflation eased to 1.1 per cent, from 1.4 per cent previously, as the prices of non-cooked food rose at a slower pace.
Meanwhile, electricity and gas inflation fell further to 3.7 per cent, from a fall of 3.5 per cent, due to a larger decline in electricity prices.
Retail and other goods prices continued to fall, but at a slower pace of 1 per cent, compared to a decline of 1.2 per cent previously, due to increases in the prices of household appliances which offset a smaller decline in the cost of personal effects.
Private transport inflation rose at a slower pace of 1.1 per cent, from 1.3 per cent previously, on the back of a smaller increase in car prices.
Meanwhile, both services and accommodation inflation were unchanged from the previous month, at 1.1 per cent, respectively.
