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SINGAPORE: Basic consumer prices in Singapore continued to fall in September, albeit at a slower pace, data from the Monetary Authority of Singapore (MAS) and the Ministry of Commerce and Industry (MTI) showed on Friday (October 23). ).
Core inflation was -0.1% in September, compared to -0.3% in August, mainly driven by lower reductions in the cost of services and electricity and gas, MAS and MTI said.
Private transportation and accommodation are excluded from the meter.
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Consumer price index (CPI) inflation – all items – rose to 0% in September, compared to -0.4% the previous month, as the costs of services, electricity and gas and private transportation fell at a more gradual rate.
The CPI measures average price changes in a fixed basket of consumer goods and services commonly purchased by resident households. Non-consumption related expenses such as loan repayments, income taxes and home purchases are excluded.
For September, private transportation costs were down 0.1 percent year-on-year, improving from the 2.3 percent drop in the previous month due to further increases in car prices.
The cost of services also registered a slower decrease of 0.1, from 0.5 the previous month, as telecom rates increased and tuition and other rates registered a smaller decline.
The rate of decline in the cost of electricity and gas also slowed slightly to 14.2%, as new subscriptions in the open electricity market slowed.
Retail trade and other goods fell at the same rate as the previous month, as falls in clothing and footwear, as well as telecommunications equipment, were offset by increases in the cost of household durable goods and a smaller drop in prices of personal care products.
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Housing and food price inflation was unchanged.
MAS and MTI said external inflation is likely to “remain low amid weak demand conditions in key commodity markets and persistent negative output gaps in Singapore’s main trading partners” in the coming quarters. .
They also forecast that cost pressures will remain moderate on the domestic front and that accumulated slack in the labor market will affect wages.
“However, core inflation is forecast to turn slightly positive in 2021 as the disinflationary effects of government subsidies introduced this year fade and demand for some domestic services gradually recovers,” said MAS and MTI.
“Meanwhile, accommodation costs are expected to decline, due in part to declining foreign employment. On the other hand, private transportation costs should rise modestly amid an anticipated reduction in the supply of Certificates of Ownership.”
Core inflation and headline inflation are expected to be between -0.5% and 0% in 2020. For next year, core inflation is expected to average 0 to 1% and inflation overall is between -0.5% and 0.5%. penny.
