Singapore inflation expectations edge higher, says survey

July 27, 2012

SINGAPORE, July 27 — Inflation expectations of Singapore households edged higher in June from March, according to a university survey published today, signalling authorities may find it harder to put a lid on future price increases.

Households expect prices to rise by 4.45 per cent over the next year, up from 4.13 per cent in March, according to the Singapore Management University-MasterCard survey on inflation.

The five-year outlook was for headline inflation of 5.37 per cent, up from 5.20 per cent in the March survey.

Singapore's inflation is currently running well above historical levels of 2-3 per cent, with prices increasing 5.3 per cent year-on-year in June after gaining 5.0 per cent in May.

The cost of living for expatriates in the Southeast Asian city-state, a major Asian financial centre, has already surpassed main rival Hong Kong, according to some surveys.

The Monetary Authority of Singapore (MAS) on Wednesday revised upward its 2012 inflation forecast to 4-4.5 per cent from 3.5 to 4.5 per cent, but said the pace of increase will slow in the second half, indicating a possible loosening of its stance on the Singapore dollar at its next half-yearly review in October. — Reuters