ASEAN KEY DESTINATIONS
Consumer prices in Singapore fall for 14th straight month in December
SINGAPORE: Inflation in Singapore fell 0.6 per cent year-on-year in December, compared to 0.8 per cent in November, according to a joint news release from the Ministry of Trade and Industry (MTI) and the Monetary Authority of Singapore (MAS) on Monday (Jan 25).
This is the 14th straight month that consumer prices have fallen.
Private road transport cost fell by 1.1 per cent in December, compared to the 1.7 per cent decline in November. This was due to the faster pace in rise of petrol pump prices in December, which more than offset the larger drop in car prices seen in December due to the decline in Certificate of Entitlement premiums.
Accommodation cost dropped by 3 per cent in December, similar to the decline in November, and this was attributed to the soft housing rental market.
However, overall services inflation increased to 0.9 per cent in December, up from 0.7 per cent in November, due to a faster pace of increase in holiday travel expenses and a smaller decline in telecommunication services fees, said MAS and MTI.
Meanwhile, food inflation was down 1.5 per cent last month compared to the 1.6 per cent drop in November, due to the moderation of increase in prices of prepared meals such as hawker food.
For the whole of 2015, CPI-All Items inflation fell by -0.5 per cent, down from 1 per cent in 2014. This is the first decline since 2002, according to Department of Statistics (Singstat) data released on Monday.
The CPI excluding imputed rentals on owner-occupied accommodation (OOA) edged up by 0.1 per cent in 2015, lower than the 1.2 per cent increase in 2014.
MIDDLE INCOME SEES SMALLEST DROP FOR CPI-ALL ITEMS
For the different income groups, the CPI-All Items for the lowest 20 per cent, middle 60 per cent and highest 20 per cent income groups decreased by 1.1 per cent, 0.3 per cent and 0.7 per cent respectively in 2015, it added.
Singstat also said the CPI for the lowest and highest income groups - excluding imputed rentals on OOA - dipped by 0.4 per cent and 0.1 per cent respectively, while that for the middle income group went up by 0.3 per cent.
The middle income group saw the smallest decline in its CPI-All items, said Singstat. This is as the lowest income group saw lower accommodation and healthcare services costs, while drop for the highest income group was due to lower car prices and a higher expenditure share on cars.
Core inflation, which excludes the cost of accommodation and private road transport, came in at 0.3 per cent, compared to 0.2 per cent in November. This was due to higher services inflation, MAS and MTI said. They added that for the whole of 2015, MAS Core Inflation eased to 0.5 per cent, from 1.9 per cent in the preceding year.
CORE INFLATION TO PICK UP GRADUALLY OVER 2016
MAS and MTI said that looking to next year, external sources of inflation are "likely to remain muted", due to ample supply buffers in major commodity markets and weak global demand conditions.
"Notably, global oil prices have fallen by around one third since mid-October, and are expected to remain low in 2016," said MAS and MTI. "On the domestic front, some wage cost pressures remain, but their pass-through to consumer prices will be constrained by the subdued economic growth environment."
MAS Core Inflation is expected to pick up gradually over the course of 2016, the release said, as the year-on-year disinflationary effects of budgetary and other one-off measures ease.
MAS and MTI said Core Inflation is expected to come in at 0.5 to 1.5 per cent in 2016.
They added that consumer prices could continue to be dampened by lower car prices and imputed rentals on OOA, "due to an expected increase in the supply of COEs and newly-completed housing units."
CPI All-Items inflation is projected to average between -0.5 and 0.5 per cent in 2016, according to the release.
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