SINGAPORE: Data from the Department of Statistics (DOS) showed that November’s Consumer Price Index (CPI) rose 3.8 per cent compared to a year ago.
That is above the 3.7 per cent increase reached in September, which was then the highest level reached for this year. The figure was in line with market expectations, though it accelerated from the 3.5 per cent on-year hike in October.
Last month’s CPI was driven by higher costs of transport, housing and food.
Excluding accommodation costs, DOS said inflation was 3.7 per cent higher.
On-year, transport costs registered the highest increase at 9.4 per cent while housing cost followed with 4.0 per cent increase. In particular, the increase in the cost of transport stemmed mainly from higher prices of cars as premiums for certificates of entitlement soared.
Compared to the previous month, CPI was 0.3 per cent higher in November as a result of higher costs of housing, transport as well as recreation & others.
Housing costs rose by 0.5 per cent on-month due to higher accommodation costs while transport was 0.4 per cent higher from the previous month mainly due to the higher prices for cars and petrol.
The increase in holiday travel cost and salary for foreign maids also raised the index for “recreation & others” by 0.5 per cent on-month, according to the DOS.
With pressure coming from strong capital inflows across Asia and hikes in wages, commodity and oil prices, analysts say further tightening from the central bank would likely be on the cards.
DBS senior economist Irvin Seah said: “With inflationary pressure picking up, I think it is very likely the central banks will continue to tighten monetary policy and this will be in line with the outlook for monetary policy across Asia as well.
“We think Asian central banks (will) continue to be behind the curve and we expect another 24 monetary tightening moves by central banks across the region, one of which will come from the MAS in April next year.”
How does this impact Singaporeans and how will it alter our outlook on spending, investment and savings in the banks? Awesome!