Singapore inflation dipped 1.8% in September

Prices of services grew, but they were not enough to offset the moderation in retail prices.

Singapore’s inflation rate for September 2018 edged down to 1.8% YoY from 1.9% in August 2018, as a moderation in retail inflation more than offset higher services inflation, the Department of Statistics revealed.

According to an announcement, headline inflation in September stood still at 0.7% YoY, as a smaller decline in accommodation costs and higher services inflation was offset by lower retail inflation.

Meanwhile, MAS core inflation, which excludes the costs of accommodation and private road transport, eased to 1.8% YoY in September from 1.9% in August, as a moderation in retail inflation more than offset a pickup in services inflation.

Inflation as measured by CPI less imputed rentals on owner-occupied accommodation (OOA) came in slightly lower at 1.5% YoY in September, compared to 1.6% in the previous month. This was largely due to a smaller increase in the prices of retail items, which more than offset higher services inflation.

The overall cost of retail items rose by 1.5% YoY in September, moderating from the 2% increase in August. “This mostly reflected a slower pace of increase in the prices of clothing & footwear, as well as a steeper fall in the prices of recreation & entertainment goods and telecommunication equipment,” DOS added.

Meanwhile, food inflation edged down from 1.7% to 1.6% YoY in September as the prices of non-cooked food items registered a smaller increase.

Services inflation came in at 1.4% YoY in September, slightly higher than 1.3% in August. “This mainly reflected a larger increase in education services fees and a smaller decline in telecommunication services fees, which had collectively more than offset a moderation in the pace of increase in recreational & cultural services fees,” DOS said.

Accommodation costs slipped by 2.5% YoY in September, easing from the 2.6% decline in August, on account of a slower pace of decline in housing rentals

Private road transport inflation fell to 0.1% YoY in September, which was less than the 0.2% decline in August. The prices of motorcycles & scooters fell in September, reversing the increase in the previous month.

However, DOS noted the decline was more than offset by a steeper increase in petrol prices, a smaller drop in car prices, as well as an increase in Electronic Road Pricing (ERP) charges.