SINGAPORE- Singapore’s key consumer price gauge rose 2.1 percent in October from a year earlier, lower than economists’ forecasts and the smallest rise in almost three years, official data showed on Monday.
The core inflation rate, which excludes private road transport and accommodation costs, compared with a forecast of 2.5 percent in a Reuters poll of economists and September’s rate of 2.8 percent.
Core inflation in October was the lowest since December 2021 when it was also 2.1 percent. Authorities pegged the drop to moderation in services, electricity and gas, and retail and other goods inflation.
Headline inflation was 1.4 percent in annual terms in October, lower than forecast of 1.8 percent in the poll.
Last week, Singapore upgraded its 2024 economic growth forecast to around 3.5 percent from a previous range of 2.0 percent to 3.0 percent after third-quarter growth came in stronger than expected.
The core inflation figure coming close to the central bank’s guidance of 2 percent by year-end leaves room for monetary policy easing at its next meeting in January, Maybank economist Chua Hak Bin said.
Chua expects the central bank to slow the rate of appreciation of the Singapore dollar nominal effective exchange rate (S$NEER), through which it manages monetary policy.
The MAS left its policy settings unchanged at a review last month as inflation pressures continued to moderate and growth prospects improved.
On Monday, the central bank and trade ministry said core inflation was expected to remain around 2 percent into year-end and step down further to 1.5 percent to 2.5 percent in 2025.
