Singapore’s core inflation eases to 1.4% in April after two months of increases

Retail and other goods inflation rose at a slower pace – from 1.8 per cent in March to 1.5 per cent in April – as water price inflation eased in April

Services inflation fell from 2.1 per cent to 1.5 per cent in April due to smaller health insurance costs, as well as lower telecommunication services prices.

OUTLOOK

MAS and MTI noted that Singapore’s imported cost pressures are expected to pick up and broaden in the months ahead.

“As higher energy and other input costs arising from the developments in the Middle East pass through global supply chains, they will raise production and transport costs for a wider range of Singapore’s imported goods and services.

“On the domestic front, services unit labour costs are likely to increase at a slower pace this year as nominal wage growth eases from the firm levels last year. Meanwhile, domestic consumer spending could turn more cautious amid rising economic uncertainty.”

The authorities maintained their core and overall inflation projections at an average of 1.5-2.5 per cent in 2026.

“At this juncture, the risks to the inflation outlook are tilted to the upside. A more persistent disruption to global energy supplies or shortages in key intermediate inputs to regional supply chains could further raise imported costs for Singapore,” said MAS and MTI.

“However, downside risks are also present. A curtailment of industrial production due to supply chain disruptions or an abrupt tightening in global financial conditions could lead to a slowdown in economic activity and thus lower inflation.”