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Singapore’s inflation at four-year low in February as car prices drop
By Kevin Lim
Singapore's consumer price index (CPI) rose by 0.4 per cent in February from a year ago, as a sharp drop in car prices offset the impact of more expensive health care, education and stationery.
The 0.4 per cent rise in February's CPI was the slowest since January 2010 when price levels increased by 0.2 per cent year-on-year.
Economists polled by Bloomberg had expected February inflation to come in around 0.8 per cent.
Core inflation, which excludes housing and private road transport, rose by 1.6 per cent in February from a year ago.
Compared to January, prices declined by 0.1 per cent as the cost of some items fell after the Chinese New Year.
"Private road transport cost saw a sharper fall of 7.1 per cent in February, after decreasing by 3.5 per cent in January. This was mainly attributed to base effects arising from the surge in COE premiums in January 2013," the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI) said in a statement.
Looking ahead, MAS and MTI said imported inflation is expected to remain generally subdued as a result of spare production capacity in the advanced economies and ample supply buffers in the commodity markets.
However, domestic costs could pass through more significantly to prices of consumer services as firms face rising cost pressures from higher wages, they said.
Taking those factors into account, core inflation is expected to rise over the next few quarters and average 2 to 3 per cent in 2014. --- CNA/nd
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