Singapore Inflation Rate Slows to 3-Month Low of 0.6% in June


Singapore's annual inflation rate fell to 0.6 percent in June 2019 from a two-year high of 0.9 percent in the previous month and below market expectations of 0.7 percent. That was the lowest inflation rate since March, amid a marked slowdown in transport prices and a further fall in cost of housing & utilities.

Cost of transport rose by 0.6 percent in June, much softer than a 1.6 percent gain a month earlier, namely private road transport (0.2 percent vs 1.5 percent in May), public road transport (2.4 percent vs 2.5 percent), and other travel & transport (0.1 percent vs 0.6 percent). Also, prices slowed for recreation & culture (1.8 percent vs 2.3 percent), mainly due to holiday expenses (3.3 percent vs 4.3 percent); and recreation & entertainment (0.6 percent vs 0.8 percent); health care (1.1 percent vs 1.4 percent), mostly driven by a steeper fall in medical products, appliances & equipment (-1.7 percent vs -0.4 percent); and education (2.5 percent vs 2.6 percent). In addition, cost of housing & utilities dropped further (-0.8 percent vs -0.7 percent), with prices of accommodation falling for the second straight month (-1.1 percent vs -1 percent) in the wake of the phased nationwide launch of the Open Electricity Market (OEM) on electricity prices. At the same time, cost continued to fall for both clothing & footwear (-0.6 percent vs -0.9 percent), and communications (-1.7 percent vs -1.1 percent). In contrast, inflation was unchanged for household durables & services (at 1.1 percent), while cost of miscellaneous goods & services picked up (0.4 percent vs 0.3 percent). 

Meantime, prices of food increased by 1.4 percent year-on-year in June, the same pace as in May. Among food excluding food servicing services, inflation was unchanged for milk, cheese & eggs (at 0.1 percent), with cost rising faster for bread & cereals (0.9 percent vs 0.7 percent); vegetables (3.8 percent vs 3.1 percent); and non-alcoholic beverages (2 percent vs 1.8 percent). Meanwhile, prices of fish & seafood advanced at a softer rate (1.4 percent vs 1.7 percent) while cost declined for meat (-0.4 percent vs -0.3 percent); oils & fats (-0.1 percent vs 1.7 percent); fruits (-0.1 percent vs 1.8 percent); and sugar, preserves & confectionery (-0.8 percent vs 0.8 percent). Among food servicing services, inflation was unchanged for fast food (at 1.5 percent), catered food (at 4.9 percent) and hawker food (at 1.5 percent), while restaurant food prices increased faster (1.9 percent vs 1.7 percent). 
Annual core inflation, which exclude costs of accommodation and private road transport, edged down to 1.2 percent in June, the lowest since March 2017, from 1.3 percent in May.
For 2019, the country's central bank and trade ministry expect inflation to be in a range of 0.5-1.5 percent while core inflation is projected to come in near the mid-point of the 1-2 percent forecast range.
On a month-on-month basis, consumer prices dropped by 0.2 percent in June, reversing from a 0.7 percent rise in May.   

Singapore Inflation Rate Slows to 3-Month Low of 0.6% in June


Statistics Singapore l Rida Husna | rida@tradingeconomics.com
7/23/2019 9:21:17 AM