SINGAPORE, Feb 24 — Singapore’s core inflation dropped to 0.8 per cent year-on-year in January, down from a revised 1.7 per cent in December, marking its lowest level since June 2021 when it stood at 0.6 per cent.
The decline was driven by lower inflation across all broad consumer price index categories, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) said today, according to a report in Channel News Asia.
On a month-on-month basis, core inflation, which excludes accommodation and private transport, fell by 0.2 per cent.
Meanwhile, overall inflation eased to 1.2 per cent in January from 1.5 per cent in December, reflecting a moderation in accommodation inflation along with the decline in core inflation.
“This reflected a moderation in accommodation inflation, in addition to the fall in core inflation,” said the authorities.
Month-on-month, overall inflation declined by 0.7 per cent.
Services inflation slowed from 1.6 per cent in December to 1.0 per cent in January, mainly due to lower costs for general, vocational and higher education, as well as outpatient and inpatient care services.
Food inflation also eased, falling to 1.5 per cent from 2.3 per cent, as prices of prepared meals rose at a slower pace.
Accommodation inflation moderated from 2.1 per cent to 1.6 per cent due to smaller increases in housing rents and housing maintenance and repair costs.
Retail and other goods inflation saw a sharper decline, moving from 0.5 per cent in December to -0.6 per cent in January, reflecting a drop in footwear prices along with lower costs for medical goods and other personal effects.
Electricity and gas inflation fell from 2.4 per cent to -2.9 per cent due to lower electricity prices, though gas prices continued to rise at a slower pace.
Private transport inflation, however, rose to 2.8 per cent from -0.9 per cent in December, driven by higher car prices.
MAS and MTI expect Singapore’s imported inflation to remain moderate, supported by “favourable supply projections in key food commodity markets and forecasts of declines in global oil prices.”
While trade tensions could contribute to inflationary pressures in some economies, the impact on Singapore’s import prices is likely to be offset by weaker global demand, the authorities said.
Domestically, unit labour costs are expected to rise gradually as nominal wage growth eases while productivity improves.
Additionally, government subsidies for public healthcare, preschool education, and public transport will help contain services inflation.
For 2025, MAS and MTI maintain their forecast that core inflation will average between 1.0 per cent and 2.0 per cent, while overall inflation is projected to range from 1.5 per cent to 2.5 per cent, with an “anticipated pick-up in private transport inflation.”
