Core inflation eased to 0.6% in June

Inflation for all items meanwhile remained unchanged at 2.4% YoY.

The increase of prices slightly slowed down with core inflation in June at 0.6% year-on-year (YoY) from 0.8% in May.

The 0.2% decline in MAS core inflation, which excludes components of accommodation and private transport, is due to the “steeper decline in the cost of retail and other goods,” according to the Monetary Authority of Singapore and the Ministry of Trade and Industry.

Cost of retail and other goods fell 1.8% in June from a 0.8% decline in May due to the steep decline in clothing and footwear. Clothing and footwear inflation fell 9% in June YoY and 4.9% compared to May.

The consumer price index for all items remained unchanged from May at 2.4% YoY as the drop in retail and other goods were offset by the inflation in private transport and accommodation.

Private transport rose to 14.9% from 14.5% in May due to an increase in car prices, while accommodation rose to 1.1% in June from 0.9% the previous month as housing rents rose.

Food inflation dipped to 0.9% in June from 1%, cost of services remained unchanged at 1.4%, while electricity and gas inflation fell to 1.8% from 1.9%.

Meanwhile, the consumer price index (CPI) in all items for general households increased by 1.5% YoY from January to June, according to the Department of Statistics.

By household income groups, the price index for all items rose by 0.9%, 1.4%, and 1.9% YoY for the lowest 20%, middle 60% and highest 20% income groups respectively.

The main contributors to the inflation for the first half to the three income groups were cars, food, petrol, accommodation, and tuition and other fees, partially offset by lower costs of electricity, and clothing and footwear.

The CPI, excluding imputed rentals on owner-occupied accommodation (OOA) for the lowest 20% income group increased by 0.8%, middle 60% by 1.4%, and highest 20% by 2.2% YoY.

It said that the lowest 20% income group has the smallest increase in CPI excluding OOA compared to other groups as “lower costs of electricity had a larger dampening impact on its CPI as electricity constituted a higher share of its expenditure basket.”

The increase in prices of higher car and petrol had a smaller impact on its CPI as they only accounted for a smaller part of the group’s expenditure basket.