Singapore’s Inflation Slowed Sharply in November

By Fabiana Negrin Ochoa

Singapore’s inflation decelerated in November, registering the lowest reading this year as car prices rose much slower, pushing down private transport inflation.
The consumer-price index climbed 3.6% last month from a year earlier, the Department of Statistics said Tuesday. That compared with October’s 4.7% rise and the 6.6% peak in January.

Economists had broadly expected inflation to ease in the penultimate month of the year. HSBC Global Research had penciled in a 4.0% rise, while a consensus estimate compiled by data provider FactSet had tipped a print of 3.2%.
Transportation costs, with an index weighting of 17.07%, rose 2.8% in November, down sharply from October’s 8.4% reading. Housing and utilities costs, which make up 24.84% of the index, jumped 3.8%, slowing slightly from the prior month’s 3.9% increase. Food prices, which have a 21.10% weighting, were up 4.0%, nearly on par with the 4.1% increase recorded in October.
Core CPI, which strips out private road transport and accommodation costs, also slowed in November from a year earlier, the data showed. The measure edged down to 3.2% from 3.3% in October, “driven by lower inflation for retail & other goods, food, as well as electricity & gas,” the Monetary Authority of Singapore and the Ministry of Trade and Industry said in a joint statement.
For January through November, headline inflation was 4.9% and core inflation was 4.2%.
The MAS and the ministry expect lower global prices for crude oil, most food commodities, and manufactured goods to help temper Singapore’s import cost pressures.
For 2023, inflation is expected to average around 5%. Core inflation is projected to hover around current levels and come in at the upper end of the 2.5%-3.0% guidance range at year’s end.
Early next year, core inflation will likely be affected by the increase in the goods and services tax rate, as well as seasonal effects, the statement said. However, it should resume a broadly moderating trend over the next year “as import cost pressures decline and tightness in the domestic labor market continues to ease.”
“In 2024, headline and core inflation are projected to average 3.0%-4.0% and 2.5%-3.5%, respectively,” the ministry and the MAS said.
They noted that risks to the inflation outlook persist, including from fresh shocks to global energy and food prices and more persistent-than-expected tightness in the job market at home.
Write to Fabiana Negrin Ochoa at [email protected]