Singapore inflation eases to 3.9% in August

Accommodation cost and services fees saw only moderate increases.

Based on new data from the MInistry of Trade and Industry (MTI), CPI-All Items inflation edged down slightly to 3.9% in August from 4.0% in July 2012.

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, MTI consumer price data showed.

MTI data further revealed that 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.

CPI less imputed rentals on owner-occupied accommodation (CPI-ex OOA) remained at 3.0%. Inflation as measured by CPI less imputed rentals on OOA (CPI-ex OOA) was unchanged at 3.0% in August. Lower contributions from cars and services were offset by the increase in petrol pump prices.

Meanwhile, MAS Core Inflation came in lower at 2.2%. Excluding the costs of accommodation and private road transport, MAS Core Inflation fell from 2.4% in July to 2.2% in August on account of slightly lower services inflation.