Chart of the Day: Inflation eases to 3.9%

Thanks to more moderate increases in services fees and accommodation cost in August.

The Monetary Authority of Singapore and the Ministry of Trade and Industry reported:

CPI-All Items inflation edged down slightly to 3.9% in August from 4.0% in July 2012, mainly reflecting more moderate increases in accommodation cost and services fees.

Accommodation cost inflation slowed to 7.4% y-o-y in August from 7.8% in July as residential property rentals rose at a more moderate pace. Nevertheless, imputed rentals on owner-occupied accommodation (OOA) continued to contribute a considerable 1.4% points to overall inflation.

Private road transport cost rose by 6.3% y-o-y in August, slightly higher than the 5.9% in the preceding month. Petrol pump prices increased in August after two consecutive months of decline, but car prices climbed more moderately compared to that in July. Together, accommodation and private road transport costs accounted for around 60% of CPI-All Items inflation in August.

Food price inflation was stable at 2.3%, while the increase in services fees eased from 2.8% in July to 2.7% in August.