Singapore's inflation rate jumps to 1.4% in May
SINGAPORE: Consumer prices in Singapore edged up in May from the previous month, according to figures from the Department of Statistics on Friday (Jun 23).
The consumer price index (CPI) - a key measure of headline inflation - rose to 1.4 per cent in May, compared with 0.4 per cent in April.
The increase was mainly due to a change in the timing of the disbursement of service and conservancy charges (S&CC) rebates, said the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI).
S&CC rebates were disbursed in May last year, but in April this year.
As a result of the change, housing maintenance and repairs were higher than a year ago, causing the cost of accommodation to decline by a smaller 1.5 per cent compared with the 6.7 per cent fall in April, MAS and MTI said.
The cost of electricity and gas also rose by a larger 19.1 per cent in May compared to 18.7 per cent in the previous month due to a larger increase in gas tariffs on the back of the recovery in global oil prices over the past few months.
Food inflation picked up to 1.5 per cent in May from 1.3 per cent in April, driven by a larger increase in the prices of non-cooked food items.
Private road transport inflation, on the other hand, eased from 7 per cent in April to 6.1 per cent in May on account of more moderate increases in car and petrol prices.
Services inflation also fell to 1.4 per cent from the previous month's 1.7 per cent, reflecting a decline in holiday expenses and air fares.
Meanwhile, MAS core inflation eased to 1.6 per cent in May, slightly lower than the previous month's 1.7 per cent. This was due to the fall in services inflation, which more than offset the pickup in food as well as electricity and gas inflation, authorities said.
Looking forward, MAS and MTI said external inflationary pressures have picked up amid a turnaround in global commmodity markets, with global oil prices rising from their trough in 2016 to average higher this year although this would be capped by elevated inventories and rising US crude oil production.
Domestic sources of inflation remain relatively muted, with conditions in the labour market slacked and expected to dampen underlying wage pressures, they said.
For 2017, MAS core inflation is expected to average 1 to 2 per cent, compared with 0.9 per cent in 2016, while CPI-all items inflation is projected to rise to 0.5 to 1.5 per cent from -0.5 per cent last year, added MAS and MTI.