Consumer prices in Singapore remained very stable and unchanged during 2015 and 2016. Now, it’s 2017 and consumer prices in the island city-state are rising. The trend started at the very end of winter of 2016. At present, inflation of the headline type is estimated to be at .2 percent.
Rises in the CPI (consumer price index) are believed to be because of bigger increases in the cost of private road transportation. Costs for road transport increased by 1.7 percent in winter of 2016, after a much smaller rise in November of that year.
This rise was linked with higher prices for gas, as well as higher fees for car parking. This information comes from the MAS (Monetary Authority of Singapore), as well as the MTI (Ministry of Trade and Industry). The figures were released to the public during late January of 2017.
Inflation for services went up to 1.6 percent, versus 1.5 percent in early winter. This is believed to be because Singaporeans were spending more money in order to prepare for and enjoy the holidays. This increase in spending counteracted a big contraction in service fees for telecom.
Inflation for food was two percent. This was the same percentage as the month before. The cost of accommodations decreased by 3.8 percent during winter and showed an ongoing “softness” in the rental market for housing.
In general, inflation for retail goods went down. It moved to zero during December, versus .2 percent the month before, mostly because the cost of personal care products went down.
Headline inflation was marked at .6 percent for the second year running (2016 figure). Core inflation, which doesn’t factor in accommodation costs and transport costs for public roadways, decreased by 1.2 percent, versus 1.3 percent during November. This decrease is linked with a lower rate of inflation for retail goods and offsets a boost in inflation for services. During all of 2016, core inflation went up by .9 percent, from .5 percent during 2015.
Will Prices Continue to Go Up?
One prominent economist, Francis Tan, who works at UOB, thinks that costs are likely to remain fairly muted as a result of weaker consumption and a labour market which is more subdued. Nonetheless, prices may rise if developed marketing continue to display good growth.
Tan feels that consumers are concerned about rising prices during 2017, as their wages are rather stagnant at present. He is concerned that the power to buy may be diminished.
Nonetheless, he’s not overly worried about this, as he feels that increased prices are a sign of good growth on a global scale. This means that certain sectors of manufacturing, such as the cluster for electronics, are anticipating better demand which will trigger a spillover to other niches of industry, such as precision engineering.
Business prospects in Singapore are pretty good right now. The island city-state is keeping a close eye on price shifts and other statistics and the government is doing all that it can to create new jobs and support entrepreneur.
About Morris Edwards
Morris Edwards is a content writer at companyregistrationinsingapore.com.sg, he writes different topics like The Visit Asean@50 Campaign Has Ambitious Goals, Ways to Save Money for Your Business, Doing Business in Singapore and all topics related to Company Registration.