Image credit:The Edge Malaysia
Singapore’s consumer price inflation in August 2024, saw a continuation of trends that have shaped the country’s economic landscape in recent months. The report, jointly prepared by the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI), highlighted key shifts in various sectors, underscoring the ongoing challenges faced by households and businesses alike.
According to the report, core inflation, which excludes the costs of accommodation and private transport, remained steady at 3.2% year-on-year in August, unchanged from July. This stability came as prices of services and food continued to rise but were balanced by softer price increases in retail and other goods. The moderation in these sectors contributed to a slight easing of pressure on the broader inflation outlook.
The Consumer Price Index (CPI)-All Items inflation, which encompasses the full basket of goods and services, registered a slower growth of 3.5% year-on-year, down from 3.7% in July. The decline in overall inflation was driven primarily by lower private transport costs, with petrol prices softening due to easing global crude oil prices. Accommodation costs also saw a deceleration, reflecting a more tempered rental market.
Food prices continued their upward trajectory, recording a 4.3% increase year-on-year in August, slightly higher than July’s figure. The rise was attributed to elevated costs of raw ingredients and higher wages in the food services sector. Meanwhile, services inflation also remained firm at 3.1%, driven by increased charges in healthcare, education, and holiday expenses. These trends reflect continued demand in the domestic economy and structural changes within key industries.
The August report also highlighted a notable cooling in private transport inflation, which moderated to 3.8% in August from 4.7% in July. Lower petrol prices, coupled with a smaller increase in Certificate of Entitlement (COE) premiums, contributed to this slowdown. Similarly, accommodation inflation saw a marginal decline, easing to 4.6% from 4.7% in the previous month. This reflects stabilising rental markets following the sharp rise in recent years.
However, inflation for both core and overall CPI is expected to gradually ease over the second half of 2024. This is contingent on stabilising global commodity prices and a moderation in domestic demand. Authorities are monitoring developments closely and expect inflation to ease further in 2025, though uncertainties remain, particularly regarding external economic conditions.