Singapore's March inflation slipped to 3.5%

Thanks to small price hikes.

According to a release, CPI-All Items inflation eased to 3.5% in March from 4.9% in February. This was due to smaller price increases across all major categories in the CPI, with private road transport cost accounting for the bulk of the moderation.

Private road transport cost rose by 8.6% in March, down from 17.4% a month earlier. This reflected weaker COE premiums in February and price adjustments by car dealers following the introduction of financing restrictions on motor vehicle loans.

As a result, the contribution of private road transport cost to CPI-All Items inflation fell to 1.2% points in March, half that in February. Accommodation cost inflation edged down to 5.8% in March from 5.9% in the preceding month as a result of a slightly smaller increase in market rentals.

Nevertheless, imputed rentals on owner-occupied accommodation (OOA) continued to contribute a significant 1% point to overall inflation. Together, the costs of private road transport and accommodation accounted for more than two-thirds of CPI-All Items inflation in March.

Food inflation was 1.8% in March, down from 2.3% in February, as the seasonal effect from Chinese New Year dissipated. The rise in services fees slowed to 2.5% in March from 2.7% in February, led by a moderation in household services cost increases.

Prices of oil-related items declined by a steeper 2.8% in March compared to the 0.2% fall in February, mainly due to lower petrol pump prices. 

Inflation as measured by CPI less imputed rentals on OOA (CPI-ex OOA) fell to 3.0% in March from 4.6% a month earlier, given lower contributions from private road transport, oil-related items, food and services.

MAS Core Inflation, which excludes the costs of accommodation and private road transport, eased to 1.7% in March from 1.9% in February on account of more moderate increases in the costs of food and services as well as a decline in the prices of oil-related items.