Why Singapore's April inflation is likely to shrink to 3%

What could the reason be?

According to DBS, it’s going to be a busy week with the final 1Q13 GDP growth figures, Apr13 industrial production and CPI inflation, all due to be announced on Thursday.  

The headline growth figure is likely to be revised upwards to post a contraction of 0.3% QoQ saar, up from a sharper drop of 1.4% shown in the earlier advance estimates.

Here's more from DBS:

On a year-on-year basis, this translates into a 0.4% contraction, from 0.6% previously. Possibly stronger services and construction growth are the main reasons for the better numbers although the risk is that the manufacturing growth may turn out slightly worse than expected.

Separately, inflation will likely ease further to 3.0% YoY, from 3.5% in the previous month, due to further declines in the COE premiums.