Senior Economist at UOB Group Alvin Liew reviews the latest inflation figures in Singapore.
Key Takeaways
“Singapore’s headline CPI rose by 0.2% m/m, 7.0% y/y in Jul (from 1.0% m/m, 6.7% y/y in Jun), fastest y/y print since Jun 2008 but in line with our and Bloomberg median estimate. However, core inflation (which excludes accommodation and private road transport) rose at a much faster clip, up by 4.8% y/y in Jul (from 4.4% in Jun), fastest since Nov 2008, beating expectations.”
“While the surge in core inflation was a surprise, its sources of price pressures for Jul were not unexpected. The sources of price pressures for core inflation were again broad-based including nearly all the major categories, with food, electricity & utilities and services as main drivers. As for the headline CPI inflation, other than upside to the core CPI, both the accommodation costs and private transport costs continued to play the key roles driving overall price increases. Transport component continued to lead, contributing an outsized 3.4ppts to the 7% inflation print, followed by housing & utilities (1.4ppt) and food (1.4ppt) all in similar magnitude as Jun, an indication that the sources of inflation contribution are broadening to other segments, like healthcare. Communication cost was again the only major component of CPI which saw a fall in prices, but its “contribution” was fairly insignificant.”
“In its outlook, the MAS removed its previous expectation for core inflation to peak in 3Q (2022) even as it maintained the projection for core inflation to ‘ease towards the end of 2022’. This likely means that core inflation may stay elevated for longer. Its warnings on inflation developments remained on the upside, both on the external (‘upward pressure on Singapore’s import prices are expected to persist’) and domestic fronts (tight labour market conditions and businesses to pass higher costs to consumer prices here).”
“We maintain our forecasts for headline inflation to average 6.0% and core inflation average 4.2% in 2022. Our headline CPI forecast is at the top end of the official outlook for headline CPI (5.0-6.0%) but our core CPI projection remains above the official core inflation forecast range (3.0-4.0%).”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD holds steady near 0.6500, upside potential seems limited
AUD/USD edges higher on Friday, albeit it lacks bullish conviction and remains confined in a multi-day-old range. Despite RBA's hawkish stance, geopolitical risks, concerns about Trump's tariff plans, and US-China trade-war fears act as a headwind for the Aussie.
USD/JPY slides to sub-151.00 levels after Tokyo CPI
USD/JPY dropped below the 151.00 mark following the release of strong November inflation figures from Tokyo, Japan’s capital, which backs the case for another BoJ rate hike in December.
Gold price holds steady as traders seem non-committed amid mixed cues
Gold price oscillates in a range during the Asian session on Friday, awaiting a fresh catalyst before the next leg of a directional move amid mixed fundamental cues. Bets that the Fed might be cautious about further rate cuts trigger a modest recovery in the US bond yields and act as a tailwind for the USD, capping the non-yielding yellow metal.
Crypto Today: BTC climbs to $97K, SHIB demand dips, TON lifted by Tornado Cash verdict
Bitcoin price rose 4% on Thursday, breaching the $97,000 mark after opening at $91,947 on Wednesday. Amid the BTC rally, privacy-inclined projects like Monero (XMR) and Toncoin (TON) received a major boost alongside crypto AI coins such as Render (RNDR) and Artificial Super Intelligence Alliance, (FET).
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.