Anxious Singaporeans expect 4.45% price hike

Looks like Singapore households would be cash-strapped for another year.

In a survey by the Singapore Management University and MasterCard, Singapore households’ one-year-ahead inflation expectations seems to have edged up at around 4.4%. The fourth survey on inflation expectations Index shows that Singapore’s inflation expectations inched up slightly in the second quarter of 2012. This may be attributed to more informed consumers who are anxious although cautiously optimistic towards the global economy in the short to medium term.

Here's more from SInDEx:

The June 2012 quarterly survey showed for the current year, the SInDEx1, a composite medium term inflation expectations index which measures inflation expectations over the next one year, has slightly increased to 4.4% up from its record low of 4.2% in the March 2012 survey. The Headline inflation expectations (which measures overall inflation expectations for the coming one year) rate is slightly higher at 4.45% up from March 2012 survey value of 4.13%, which was also the lowest since the inception of these quarterly surveys in September 2011. The medium term Singapore Core inflation expectations (excluding accommodation and private transportation) also edged up to 4.39% from its lowest ever level of 4.2% recorded in the March 2012 survey.

This fourth SInDEx survey follows three earlier surveys conducted in September and December last year, and in March this year. The fourth online survey was conducted in June 2012 and it gathered feedback from around 400 individuals from Singapore households. Consumers were asked a variety of demographic and socioeconomic questions. The consumers also shared their views on perceived values of economic variables over the next one to five years.

As for the next five years, SKBI-MasterCard Singapore Index of Inflation Expectations (SInDEx5, the composite weighted five-year inflation expectations) was at 5.08%, from 4.97% in March this year. The five-year Headline inflation expectations (which measures overall inflation expectations five years from now) was back to 5.37% from 5.2% last quarter. The five-year Singapore Core inflation expectations (excluding accommodation and private transportation) moved up slightly to 4.91% from the March figure of 4.8%.

The SKBI-MasterCard Singapore Index of Inflation Expectations (SInDEx) was launched in January 2012. It was developed by Dr Aurobindo Ghosh and Professor Jun Yu from SMU Sim Kee Boon Institute for Financial Economics (SKBI), in collaboration with MasterCard. SInDEx is derived from an online survey designed to help researchers understand the behaviour and sentiments of decision makers in Singapore.