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Singapore inflation rate slows to 3-month low of 0.6% in June

Christian Fernsby ▼ | July 24, 2019
Singapore's annual inflation rate fell to 0.6 percent in June 2019 from a two-year high of 0.9 percent in the previous month and below market expectations of 0.7 percent.
Singapore inflation
Asia   That was the lowest inflation rate since March
That was the lowest inflation rate since March, amid a marked slowdown in transport prices and a further fall in cost of housing and utilities.

Cost of transport rose by 0.6 percent in June, much softer than a 1.6 percent gain a month earlier, namely private road transport (0.2 percent vs 1.5 percent in May), public road transport (2.4 percent vs 2.5 percent), and other travel and transport (0.1 percent vs 0.6 percent).

Also, prices slowed for recreation and culture (1.8 percent vs 2.3 percent), mainly due to holiday expenses (3.3 percent vs 4.3 percent); and recreation and entertainment (0.6 percent vs 0.8 percent); health care (1.1 percent vs 1.4 percent), mostly driven by a steeper fall in medical products, appliances and equipment (-1.7 percent vs -0.4 percent); and education (2.5 percent vs 2.6 percent).

In addition, cost of housing and utilities dropped further (-0.8 percent vs -0.7 percent), with prices of accommodation falling for the second straight month (-1.1 percent vs -1 percent) in the wake of the phased nationwide launch of the Open Electricity Market (OEM) on electricity prices.

At the same time, cost continued to fall for both clothing and footwear (-0.6 percent vs -0.9 percent), and communications (-1.7 percent vs -1.1 percent).

In contrast, inflation was unchanged for household durables and services (at 1.1 percent), while cost of miscellaneous goods and services picked up (0.4 percent vs 0.3 percent).

Meantime, prices of food increased by 1.4 percent year-on-year in June, the same pace as in May.

Among food excluding food servicing services, inflation was unchanged for milk, cheese and eggs (at 0.1 percent), with cost rising faster for bread and cereals (0.9 percent vs 0.7 percent); vegetables (3.8 percent vs 3.1 percent); and non-alcoholic beverages (2 percent vs 1.8 percent).

Meanwhile, prices of fish and seafood advanced at a softer rate (1.4 percent vs 1.7 percent) while cost declined for meat (-0.4 percent vs -0.3 percent); oils and fats (-0.1 percent vs 1.7 percent); fruits (-0.1 percent vs 1.8 percent); and sugar, preserves and confectionery (-0.8 percent vs 0.8 percent).

Among food servicing services, inflation was unchanged for fast food (at 1.5 percent), catered food (at 4.9 percent) and hawker food (at 1.5 percent), while restaurant food prices increased faster (1.9 percent vs 1.7 percent).

Annual core inflation, which exclude costs of accommodation and private road transport, edged down to 1.2 percent in June, the lowest since March 2017, from 1.3 percent in May.

For 2019, the country's central bank and trade ministry expect inflation to be in a range of 0.5-1.5 percent while core inflation is projected to come in near the mid-point of the 1-2 percent forecast range.

On a month-on-month basis, consumer prices dropped by 0.2 percent in June, reversing from a 0.7 percent rise in May.