Singapore CPI decline for 18th straight month

StraitTimes Report: The consumer price index, a measure of inflation, fell again in April – the 18th straight month of decline. This was the longest stretch of falling prices seen here since 1977. Headline consumer price inflation fell 0.5 per cent last month from April last year, due mainly to the continued fall in private road transport costs, according to a joint release from the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI) on 23 May.

The decline was slightly smaller than economists’ forecasts of a 0.7 per cent decrease, and half that of March’s 1 per cent fall dip, largely due to the low base from rebates on service & conservancy charges that were given out in April 2015, they said. Private road transport costs fell by 7.1 per cent in April from a year ago, faster than the 5.9 per cent decline a month earlier. This was mainly due to a larger decline in car prices amid weaker Certificate of Entitlement (COE) premiums, as well as a bigger drop in petrol pump prices.

However, prices elsewhere in the economy continued to edge upwards. The core inflation measure, which strips out accommodation and private road transport costs to better gauge everyday expenses, ticked up 0.8 per cent in April from 0.6 per cent a month ago, mainly due to higher services inflation as well as a smaller decline in electricity tariffs. The MAS said core inflation is expected to pick up gradually over the course of the year, partly because oil prices are expected to be slightly higher in the second half of the year compared with the first half.

The disinflationary effects of Budget measures and other one-off programmes will also ease as time goes by. These measures include medical subsidies under the Pioneer Generation Package, the reduction in the concessionary foreign domestic worker levy, as well as the abolition of national examination fees for Singaporeans implemented last year.

This news was first published in StaitsTimes, Singapore. Click here