Accommodation prices were 5.3% cheaper in January

Service & Conservancy Charges (S&CC) rebates were given to HDB households in January 2018.

Inflation stayed flat in January from 0.4% in December, mostly due to lower accommodation and private road transport inflation. Meanwhile, MAS Core Inflation rose to 1.4% from 1.3% in the previous month, as higher retail inflation more than offset a decline in food inflation.

Across all prices, accommodation moved the most and fell by 5.3%, compared to the 3.8% decline in December, as Service & Conservancy Charges (S&CC) rebates were given to HDB households in January 2018, but not in the same month last year.

The quantum of S&CC rebates was increased in 2017, with an additional 0.5 month of rebates given to most HDB households in January 2018. S&CC rebates, which lower the housing maintenance & repair cost component of the accommodation CPI, were given in April, July, and October last year, but not in January. This resulted in a negative contribution to inflation.

Here’s more from MAS and MTI:

Private road transport inflation moderated to 1.6% in January from 2.6%, due to lower car prices and a decline in Certificate of Entitlement (COE) premiums. Food inflation eased to 1.1% in January from 1.4% in December, largely on account of a moderation in the price increases for non-cooked food items. The cost of prepared meals also rose at a slightly slower pace compared to the previous month.

Services inflation was 1.3% in January, unchanged from the previous month, as a smaller decline in the cost of public road transport, together with larger increases in education and recreational & cultural services fees, offset a fall in telecommunications services fees and a steeper drop in airfares.

The cost of electricity & gas rose by 6.7% in January, higher than the 6.3% increase in the previous month, as electricity tariffs were revised upwards following a rise in global oil prices in the preceding months. The overall cost of retail items increased by 1.3% in January, larger than the 0.4% rise in December, as the prices of personal care products and clothing & footwear picked up, reversing the declines recorded in December.

Inflation, as measured by CPI less imputed rentals on owner-occupied accommodation (OOA), fell to 1.0% in January from 1.4% in December. This was largely on account of the decline in the cost of housing maintenance & repairs arising from the disbursement of the S&CC rebates, as well as lower private road transport inflation.