Singapore's annual inflation fell to an eight-month low in January, mainly due to lower contribution from private road transport costs, official data showed Thursday.
Consumer price inflation came in at 4.8 percent in January, down from 5.5 percent in December, a joint release from the Ministry of Trade and Industry and the Monetary Authority of Singapore showed. Inflation was in line with economists' forecast. The latest figure was the lowest since May 2011, when consumer prices rose 4.5 percent.
Within the overall consumer price index (CPI), housing cost logged the biggest annual growth of 9.5 percent, while communication charges dipped 0.5 percent. Transport and recreation cost climbed 3.5 percent each. Food prices rose 3.8 percent and the prices of clothing and footwear increased 1.2 percent.
Core annual inflation picked up to 3.5 percent from 2.6 percent in December. The increase largely reflected the uptick in food prices during the Chinese New Year and low base in January 2011 due to the removal of radio and television license fees.
On a monthly basis, consumer prices moved up 0.9 percent in January, after remaining unchanged in the previous month. The Core CPI also rose 0.9 percent on a monthly basis.
Inflation is likely to be elevated and volatile over the coming few months, the government said. The continued rise in housing rentals is expected to add imputed rentals on owner-occupied accommodation in the near term. Moreover, private road transport cost is likely to remain high on average in view of the tight Certificate of Entitlement supply.
Core inflation is forecast to remain around 3 percent in the next few months. In the whole of 2012, inflation is seen between 2.5 percent and 3.5 percent, while core inflation is forecast in the range of 1.5-2 percent.
In October, the Monetary Authority of Singapore loosened its policy stance amid weak growth outlook and expectations for a moderation in core inflation, by lowering the slope of the policy band, in turn allowing the Singapore dollar to appreciate at a slower pace.
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