Singapore CPI extends pullback for 20th straight month with 0.7% dip in June

On back of smaller slip in accommodation costs.

Singapore’s headline Consumer Price Index (CPI) has extended its decline for the 20th straight month with a dip of 0.7% YoY in June, compared to its 1.6% tumble in May 2016.

According to a joint news release by the Ministry of Trade and Industry and the Monetary Authority of Singapore, the decline is due mainly to a smaller 3.5% decline in accommodation costs, in contrast to the 6.0% decrease in May when S&CC rebates to households cut down the cost of housing maintenance & repairs.

Meanwhile, actual and imputed rental costs continued to tumble amid the soft residential market.

Private road transport cost dipped by a more modest 5.7% versus the 7.6% decline a month earlier, largely due to a more conservative slip in car prices on the back of a smaller contraction in Certificate of Entitlement (COE) premiums on a year-ago basis.

Services inflation inched up to 1.6% from 1.5% in the previous month, reflecting larger contributions from rising holiday expenses and telecommunication services fees. In comparison, food inflation slipped to 2.1% from 2.2% a month ago. This is due to a moderation in price increases for prepared meals, such as hawker food and restaurant meals.

Moreover, CPI less imputed rentals on owner-occupied accommodation (CPI-ex OOA) inflation was 0% in June, up from -1.0% a month earlier. The climb in inflation was thanks mostly to the dissipation of the impact of the S&CC rebates that were disbursed in May.

MAS Core Inflation, which excludes the costs of accommodation and private road transport, increased slightly to 1.1% from 1.0% in May, as a result of higher services inflation.