Singapore inflation drops to 2-year low in November
2012-12-25 12:12:55
Singapore's inflation weakened to the lowest level in about two years in November, owing mainly to slower growth in accommodation and transportation costs, latest data showed Monday.
Inflation as per the consumer price index dropped to 3.6 percent from 4 percent in October, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry said. Economists had forecast a slower deceleration to 3.8 percent. The latest figure was the lowest since October 2010, when consumer prices moved up 3.5 percent from a year ago.
Driving the overall slowdown, the pace of increase in accommodation costs eased to 6.6 percent from 6.8 percent in October, while private road transport costs rose at a notably slower rate of 6.7 percent than the previous month's 8.3 percent. The service cost inflation dropped to 2.9 percent from 3.1 percent, while food inflation stayed unchanged at 1.7 percent.
The consumer price index edged up 0.1 percent compared to October, when they dropped by 0.2 percent, data showed.
Core inflation, excluding costs of accommodation and private road transport, weakened to 2 percent in November from 2.2 percent in the previous month, due to lower contributions from services and oil-related items.
The government has forecast that inflation would remain elevated in the fourth quarter this year and the first quarter of 2013, reflecting significant contributions from imputed rentals on owner-occupied accommodation and car prices.
In 2012, headline inflation is expected to come in slightly above 4.5 percent, and 3.5-4.5 percent next year, according to the Monetary Authority of Singapore.
"Given continued weakness in the global economy, imported inflation will be generally benign, although global food prices could face further upward pressures in the next few months due to weather-related supply disruptions," the trade ministry and the central bank said in a joint statement today.
Singapore's economy contracted a seasonally adjusted 5.9 percent in the third quarter compared to the previous three months. Exports, the city's main growth-driver, unexpectedly shrunk by 2.5 percent in November as a result of a sharper reduction in shipments of electronic products.