Singapore’s inflation continued to accelerate as headline CPI increased faster by +7.5%yoy in Aug-22 (Jul-22: 7.0%yoy), exceeding the market consensus (+7.2%yoy).
This was the fastest inflation reading caused by more significant price rises for services and food. Meanwhile, expense like housing (+6.0%yoy), clothes (+8.7%yoy), transportation (+20.2%yoy) and recreation & culture (+8.7%yoy) contributed to additional upward pressures of inflation.
Meanwhile, the core inflation, excludes private transport and accommodation, rose sharply by +5.1%yoy in Aug-22 (Jul-22: +4.8%yoy), recording the highest increase since Nov-08 and exceeding the market consensus.
"Moving ahead, we opine that the higher inflation may cause Monetary Authority of Singapore (MAS) to tighten its monetary policy after having tightened for four times in the prior years to cool inflationary pressure," says MIDF.