Singapore (Commonwealth Union)_Core inflation in Singapore increased to 4.2 percent Year on Year (YoY) in June, albeit easing from 4.7 percent in May. Aligned with economic forecasts, the Monetary Authority of Singapore and the trade ministry made the observations that with global supply chain frictions subsiding, food commodity and energy prices are moderating. The rate of this key economic consumer gauge however did not reflect private road transport and accommodation.
Headline inflation increased 4.5 percent YoY in June, when compared with 5.1 per cent in May and a forecast of 4.55 percent. The expectation is that core prices will continue to moderate in the second half of 2023. The forecast was for core inflation to average between 3.5 – 4.5percent and headline inflation at 4.5-5.5 percent this year.
Economists expect the Monetary Authority of Singapore to keep monetary policy settings unchanged when it comes up for review in October, given the weak growth outlook and inflation which yet remains elevated albeit easing. Monetary policy rates were left unchanged in the last review in April post a tightening of rates five times consecutively since October 2021. This was done in the background of Singapore’s growth outlook, which economists believed was heading towards a recession in the second quarter of 2023. Economists however warn of a possible downward revision in final data.
Singapore is a 710 square kilometer island in South East Asia led by a parliamentary democratic system since its independence from the Commonwealth in August 1965. A thriving metropolis housing world class infrastructure, a dynamic business environment and a culture of innovation, technology and high governance, Singapore is renowned to be the cutting edge hub of the world for business. Known as the most pro-business country in the world and the fourth least corrupt, its GDP growth has been retained at 7.6 percent amid a highly developed and knowledgeable population of 5 million.
