SINGAPORE- Singapore’s key consumer price gauge rose in January by its fastest pace in nearly a decade, largely in line with economist forecasts, driven by higher inflation for food, electricity and gas, official data showed on Wednesday.
The core inflation rate – the central bank’s favoured price measure – rose 2.4 percent in January on a year-on-year basis, the highest since September 2012. A Reuters poll of economists had forecast a 2.5 percent increase.
Headline inflation rose by 4 percent, largely in line with economists’ forecast of 4.1 percent.
Singapore’s central bank tightened its monetary policy settings last month in its first out-of-cycle move in seven years, as global supply constraints and brisk economic demand elevate inflation pressures across the region.
The city-state’s trade-dependent economy is highly susceptible to swings in global inflation and the central bank’s sudden move comes as price pressures ring alarm bells for policymakers elsewhere in Asia.
The Monetary Authority of Singapore (MAS), which manages monetary policy through exchange rate settings, said it would slightly raise the rate of appreciation of its policy band.
The width of the band, known as the Nominal Effective Exchange Rate, or S$NEER, and the level at which it is centered will be unchanged.
The MAS, which typically holds scheduled policy reviews twice a year, once in April and then in October, last surprised with an off-cycle move in January 2015 when it eased its policy after a collapse in global oil prices.
Last year, many Asia-Pacific economies largely shrugged off inflationary threats that had rattled policymakers in Europe and the United States but that thinking now appears to be shifting. — Reuters
