Singapore CPI inflation moderates to 3.6 pct in January

Singapore's consumer price inflation (CPI) in January moderated to 3.6 percent, compared with 4.3 percent for last December, the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry jointly announced on Monday.

The MAS said in a statement that even though the private road transport cost rose more sharply in Jan., "the contributions of all other major categories were lower, partly because of base effects."

In particular, the city-state's private road transport cost rose at a higher pace of 10.5 percent in January, surging from that of 9.3 percent in last December, mainly due to sharply higher Certificates of Entitlement (COE) premiums in December 2012 compared to a year ago.

Accommodation cost, another main drive for the country's inflation, saw inflation eased to 6.1 percent from 8.5 percent in the preceding month.

"Together, accommodation and private road transport costs accounted for more than three quarters of CPI-All Items inflation in January," the MAS said in a statement.

Besides, services inflation edged down to 1.9 percent in January from 2.5 percent in December, and the prices of oil- related items in the CPI also fell by 1.4 percent, the first y-o-y decline since December in 2009, reflecting the weakness in global oil prices towards the end of 2012.

The food inflation increased by a slower 1.0 percent in January, compared with 1.5 percent in December, mainly on account of the higher base in last January due to the seasonal rise in food prices during the Chinese New Year.

The MAS core inflation, which excludes accommodation and private road transport costs, was also slowed to 1.2 percent, compared with that of 1.9 percent in December, "with lower contributions from all its major components."

The central bank said the imported inflation will be broadly benign considering the subdued conditions in the global economy, while, however, "the persistent tightness in the labour market will support wage increases in 2013, some of which will continue to be passed through to consumer prices."

The MAS remained the core inflation at 2-3 percent for the whole year, while the CPI-All items inflation will be 3.5-4.5 percent in 2013, the MAS added.