Singapore core inflation drops for third straight month to 3.8% in July

SINGAPORE – Consumer prices in Singapore rose at a slower pace for a third consecutive month on the back of a smaller hike in food prices and a fall in the costs of electricity and gas.

Core inflation, which excludes private transport and accommodation costs to better reflect the expenses of Singapore households, dropped to 3.8 per cent year on year in July, from 4.2 per cent in June.

The July figure is the lowest since mid-2022.

Headline inflation, or the overall consumer price index also eased, to 4.1 per cent from 4.5 per cent in June, led partly by lower private transport inflation.

Both core and headline inflation figures matched the forecasts of analysts in a Reuters poll.

On a month-on-month basis, which represents how much momentum there still is in prices, core consumer prices edged up 0.2 per cent in July, largely due to the rise in the costs of services and food.

Overall consumer prices dipped 0.2 per cent from June on the back of lower accommodation and private transport costs.

The decline in accommodation costs was mainly due to the rebates for service and conservancy charges to those living in Housing Board flats in July, the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI) said in its report on Wednesday.

Electricity and gas inflation recorded the steepest decline in July, with their prices falling 1.6 per cent because of lower tariffs. They had risen 3.1 per cent in June.

Led by a slower rise in car prices, private transport inflation came in at 4.8 per cent in July, lower than the 5.8 per cent in June.

Inflation for food and retail was also lower, dipping to 5.3 per cent and 2.6 per cent respectively.

Services inflation remained unchanged at 3.6 per cent in July, while accommodation inflation bucked the trend to edge up to 4.6 per cent due to an increase in service and conservancy charges from a year ago.

MAS and MTI maintained their forecasts for overall inflation for 2023 to between 4.5 per cent and 5.5 per cent, while core inflation was pegged at between 3.5 per cent and 4.5 per cent.


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