Singapore’s core inflation rate in June fell to 2.9% year-on-year, marking the lowest level in more than two years. According to the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI), this trend of gradual moderation is anticipated to continue throughout the rest of 2024, with a more significant decrease expected in the fourth quarter.
Comparison with Previous Months
The June figure represents a slight decline from May’s core inflation rate of 3.1%. It matches the rate recorded in March 2022, reflecting a period of relative stability in core inflation levels over recent years.
Factors Contributing to the Decline
The decrease in core inflation was primarily influenced by reduced price growth in retail and other goods, as well as services. This information was detailed in the data released by MAS and MTI on Tuesday, July 23. These sectors have experienced slower inflation, contributing to the overall dip in the core inflation rate.
Looking Ahead: Inflation Trends
MAS and MTI predict that core inflation will maintain its gradual decline for the remainder of 2024. This forecast suggests that consumers and businesses can expect a more stable pricing environment, particularly towards the end of the year when a more noticeable step-down in inflation rates is projected.
Economic Implications
The decline in core inflation is a positive signal for Singapore’s economy, indicating effective management of inflationary pressures. It also suggests potential relief for consumers facing cost-of-living challenges. As inflation moderates, purchasing power is likely to improve, contributing to economic stability and growth.
Conclusion
The reduction in Singapore’s core inflation to 2.9% in June marks a significant milestone, reflecting the lowest rate in over two years. With continued moderation expected, the outlook for inflation remains cautiously optimistic, promising a more stable economic environment for the rest of 2024.
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