SINGAPORE: Singapore's core inflation fell to 1.8 per cent year-on-year in December from 1.9 per cent in November.
The drop was due to a moderation in services inflation, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) said on Thursday (Jan 23).
The last time core inflation was lower was in November 2021, when it came in at 1.6 per cent.
On a month-on-month basis, core inflation – which excludes accommodation and private transport – increased 0.5 per cent.
Meanwhile, overall inflation was unchanged at 1.6 per cent on-year in December.
"This was because lower core and accommodation inflation was offset by a milder decline in private transport costs," MAS and MTI said.
On a month-on-month basis, overall inflation – which excludes non-consumption expenditures such as purchases of houses, shares and other financial assets and income taxes – rose 0.3 per cent.
For the whole of 2024, core inflation averaged 2.7 per cent, down from 4.2 per cent in 2023.
Overall inflation came in at 2.4 per cent for 2024, down from 4.8 per cent the previous year.
Private transport costs fell at a slower pace from -0.7 per cent in November to -0.1 per cent in December due to a smaller decline in car prices.
Services inflation slowed further from 2.2 per cent to 1.8 per cent. Inflation eased as holiday expenses fell and public transport costs rose at a slower pace.
Accommodation inflation also edged down to 2.2 per cent from 2.4 per cent on account of a smaller increase in housing rents.
Electricity and gas inflation remained the same at 2.5 per cent, as the prices of electricity and gas rose at similar rates in November and December.
Retail and other goods inflation meanwhile saw a slight increase to 0.3 per cent from 0.1 per cent in November.
"Retail and other goods inflation picked up due to a smaller decline in the prices of personal effects, alongside a larger increase in the prices of medicines and health products," MAS and MTI said.
Food inflation also increased from 2.4 per cent to 2.5 per cent because of a larger increase in the prices of non-cooked food.
MAS and MTI said global commodity price pressures are projected to stay contained amid favourable supply conditions.
Along with easing global inflation and the gradually strengthening trade-weighted Singapore dollar exchange rate, prices of Singapore's imported manufactured goods have also continued to be on a broad decline, they added.
Domestically, unit labour costs are projected to rise more gradually alongside moderating nominal wage growth and improving productivity.
"Correspondingly, services inflation, which has been on an easing trend, should be lower this year," MAS and MTI said.
"Reflecting these factors, MAS core inflation is projected to step down in 2025 compared to 2024."
Meanwhile, overall inflation is also likely to ease in 2025 as an "anticipated pick-up in private transport inflation from its low level in 2024 should be more than offset by lower accommodation and core inflation", MAS and MTI added.
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The drop was due to a moderation in services inflation, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) said on Thursday (Jan 23).
The last time core inflation was lower was in November 2021, when it came in at 1.6 per cent.
On a month-on-month basis, core inflation – which excludes accommodation and private transport – increased 0.5 per cent.
Meanwhile, overall inflation was unchanged at 1.6 per cent on-year in December.
"This was because lower core and accommodation inflation was offset by a milder decline in private transport costs," MAS and MTI said.
On a month-on-month basis, overall inflation – which excludes non-consumption expenditures such as purchases of houses, shares and other financial assets and income taxes – rose 0.3 per cent.
For the whole of 2024, core inflation averaged 2.7 per cent, down from 4.2 per cent in 2023.
Overall inflation came in at 2.4 per cent for 2024, down from 4.8 per cent the previous year.
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Private transport costs fell at a slower pace from -0.7 per cent in November to -0.1 per cent in December due to a smaller decline in car prices.
Services inflation slowed further from 2.2 per cent to 1.8 per cent. Inflation eased as holiday expenses fell and public transport costs rose at a slower pace.
Accommodation inflation also edged down to 2.2 per cent from 2.4 per cent on account of a smaller increase in housing rents.
Electricity and gas inflation remained the same at 2.5 per cent, as the prices of electricity and gas rose at similar rates in November and December.
Retail and other goods inflation meanwhile saw a slight increase to 0.3 per cent from 0.1 per cent in November.
"Retail and other goods inflation picked up due to a smaller decline in the prices of personal effects, alongside a larger increase in the prices of medicines and health products," MAS and MTI said.
Food inflation also increased from 2.4 per cent to 2.5 per cent because of a larger increase in the prices of non-cooked food.
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OUTLOOK
MAS and MTI said global commodity price pressures are projected to stay contained amid favourable supply conditions.
Along with easing global inflation and the gradually strengthening trade-weighted Singapore dollar exchange rate, prices of Singapore's imported manufactured goods have also continued to be on a broad decline, they added.
Domestically, unit labour costs are projected to rise more gradually alongside moderating nominal wage growth and improving productivity.
"Correspondingly, services inflation, which has been on an easing trend, should be lower this year," MAS and MTI said.
"Reflecting these factors, MAS core inflation is projected to step down in 2025 compared to 2024."
Meanwhile, overall inflation is also likely to ease in 2025 as an "anticipated pick-up in private transport inflation from its low level in 2024 should be more than offset by lower accommodation and core inflation", MAS and MTI added.
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