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Singapore Inflation January 2023

Singapore: Inflation increases in January

Inflation increased to 6.6% in January, slightly above December’s 6.5%. January’s figure marked the highest inflation rate since November 2022, but was at least partly driven by the Lunar New Year and the increase in the goods and services tax in the month. Looking at subsectors, accelerating price pressures for food more than offset lower price pressures for transport.

Annual average inflation rose to 6.3% in January (December: 6.1%). Meanwhile, core inflation rose to 5.5% in January from December’s 5.1%, undershooting market expectations.

Finally, consumer prices increased 0.19% in January over the previous month, slowing down from December’s 0.20% rise.

On the implications for monetary policy, Nomura analysts said:

“Despite the lower-than-expected Singapore January core inflation outturn, our base case remains that the MAS’ next policy decision at its regular April 2023 announcement (no later than 14 April) will likely be a late-cycle modest tightening to help anchor inflation expectations over the medium term.”

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