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Singapore Inflation

Singapore’s Core Inflation Hits 7-Month High in February

Posted on March 27, 2024
Writer: James Miller

Singapore’s core inflation rate increased sharply in February, reaching a seven-month high due to the seasonal impacts of the Lunar New Year. 

The core inflation, which omits costs related to private road transport and accommodation, was at 3.6% year-on-year, outpacing the previous month’s rate of 3.1%.

This uptick reflects the highest core inflation rate since 3.8% in July 2023. 

Overall consumer prices also rose by 3.4% from February last year, surpassing the forecasts and January’s increase of 2.9%. 

The Trade Ministry and the Monetary Authority of Singapore attribute this rise to enhanced services and food inflation following the Chinese New Year festivities.

Despite this recent surge, authorities anticipate a gradual reduction in core inflation throughout the year, supported by decreasing import cost pressures and an easing domestic labor market. 

Projections for both headline and core inflation rates remain at an average of 2.5% to 3.5% for 2024.

Analysts from Goldman Sachs expect inflation to stay high in March before potentially declining to 2% by year’s end if the Monetary Authority of Singapore maintains its current monetary policy stance through 2024. 

Singapore forecasts an economic growth rebound of 1% to 3% this year amidst a cautious global economic environment. 

For more detailed insights, read the full article on Reuters.

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