, Singapore

Here's what you need to know about Singapore's 4% inflation

Singapore dollar snubbed this news.

According to BBVA Research, sharply lower housing and transportation costs resulted in Singapore’s October inflation coming in below expectations (4.0% y/y, consensus: 4.5% y/y) after registering 4.7% y/y in September.

Here's more from BBVA Research:

The Singapore dollar largely ignored the news, ending the day broadly flat (+0.03%) at 1.225/USD. Today Singapore’s authorities also reaffirmed that inflation is expected to average around 4.5% in 2012 and between 3.5%-4.5% in 2013 (BBVA: 4.4% y/y and 3.4% y/y, respectively).

We believe inflation will grind lower for Singapore in the coming months largely due to high base effects as well as due to Singapore’s ongoing tight monetary policy – at its semi-annual policy meeting in October the Monetary Authority of Singapore decided to keep its appreciation trend in the Singapore dollar despite a slowing economy, in order to help stifle inflation.

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