Chart of the Day: Food inflation sits above historical average

It has been on a downward trend this year however, falling to 2.4% in April.

A joint report by the Monetary Authority of Singapore and the Ministry of Trade and Industry said:

Since early 2011, domestic CPI food inflation has been above its historical average of 2.0%, with relatively strong price increases in both prepared meals and non-cooked food items. Nevertheless, it has been on a downward trend this year, falling from 3.8% y-o-y in January to 2.4% in April. It averaged 2.9% in the first four months of 2012.

The recent increase in domestic food prices mainly reflected the sharp rise in global food commodity prices since the middle of 2010 as robust consumption demand from emerging economies came up against widespread supply disruptions caused by the La Nina weather phenomenon. Amid record-low stock-to-use ratios for various commodity classes, global food commodity prices, as measured by the UN FAO Food Price Index and denominated in US dollar, spiked by 18.1% in 2010 and another 22.8% in 2011 on average.