Singapore’s core inflation rose to 3.6 per cent year-on-year in February, reaching its highest level since July 2023, driven by Lunar New Year effects pushing up services and food prices, Reuters reported on Monday.
Overall consumer prices in February reached 3.4 per cent year-on-year, exceeding forecasts and reflecting higher services and food inflation due to the Chinese New Year season, the report said citing Trade Ministry and MAS.
The authorities anticipate a gradual decline in core inflation throughout the year as import cost pressures ease and labour market tightness relaxes. They maintain their forecast of 2.5 to 3.5 per cent for both headline and core inflation in 2024.
Goldman strategists expect inflation to remain elevated in March before easing to two per cent by year-end. They predict that MAS will maintain its current monetary policy parameters for the year.
Despite a slowdown in economic growth and a rise in goods and service tax, inflation remains persistent. Singapore’s economy expanded by 1.1 per cent in 2023, with growth expected to be between 1 and 3 per cent in 2024, although geopolitical risks pose uncertainties.
