Singapore's headline inflation rebounds to 3.7% y-o-y; core inflation up to 3.3% y-o-y in December

MAS will release quarterly monetary policy statements starting this year. The next statement will be released on Jan 29.

Singapore’s CPI-All Items inflation — or headline inflation — rebounded to 3.7% y-o-y in December 2023, slightly up from the 3.6% y-o-y print in November.

Similarly, the Monetary Authority of Singapore (MAS) core inflation rebounded to 3.3% y-o-y in December, up from the 3.2% y-o-y reading in November.

Like in November, transport inflation saw the greatest rise across expenditure groups, with public transport inflation reaching 2.5% y-o-y and 2.6% m-o-m in December. Private transport costs, meanwhile, rose 5.0% y-o-y but fell 0.6% m-o-m last month.

Recreation and culture saw the second-greatest rise across expenditure groups last month, with the price of related goods growing 2.0% y-o-y but falling 0.2% m-o-m. Prices of related services, meanwhile, grew 5.2% y-o-y and 0.2% m-o-m in December.

Holiday expenses grew 8.2% y-o-y and 4.3% m-o-m in December, climbing further from the 7.3% y-o-y and 0.7% m-o-m rise seen in November.

Prices of food notched the third-greatest rise across expenditure groups last month, unchanged from November, albeit at a slower pace overall. Whereas food prices grew 4.0% y-o-y and 0.3% m-o-m in November, this slowed to a 3.7% y-o-y and 0.1% m-o-m rise last month.

Prices of most foods fell m-o-m in December, with prices of prepared meals mostly flat m-o-m.

According to MAS’s previous monetary policy statement, released in October 2023, MAS Core Inflation should be on a broad moderating trend in 2024. “Although prices of crude oil have risen in recent months, global prices for most food commodities, as well as for intermediate and final goods, should be tempered by favourable supply conditions. Meanwhile, unit labour costs are expected to rise at a slower pace next year alongside the gradually cooling labour market.”

MAS Core Inflation is projected to slow to an average of 2.5%–3.5% for 2024 as a whole. Excluding the impact of the increase in the GST rate in January, core inflation is forecast at 1.5%–2.5% for the year.

Meanwhile, CPI-All Items inflation is projected to average between 3.0%–4.0% in 2024. “Private transport inflation should moderate for the year as a whole, alongside the expected increase in Certificate of Entitlement (COE) quotas. Accommodation inflation should also ease as the supply of completed housing units expands,” says MAS.

Excluding the impact of the increase in the GST rate in January, headline inflation is forecast at 2.5%–3.5%.

Starting 2024, MAS will release quarterly monetary policy statements in January, April, July and October, up from biannually. The next MAS monetary policy statement will be released on Jan 29.

See Also:

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• Citi ups core inflation forecast for December; sees slightly higher risk of a slope steepening at January MPS

• Singapore’s headline inflation fell to 3.6% y-o-y; core inflation down to 3.2% y-o-y in November

• Singapore’s headline and core inflation figures increase to 4.7% and 3.3% in October

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