Singapore CPI rises as expected in August, core inflation hits 2-yr high

Singapore's consumer prices climbed as anticipated in August, with core inflation reaching a two-year high due to surging energy, services, and food expenses, according to data released by the Monetary Authority of Singapore and the Ministry of Trade and Industry on Wednesday. The Consumer Price Index (CPI) inflation increased by 2.3% year-on-year, marking its highest level since July 2024, and aligned with market expectations.

The monthly inflation rate stood at 0.6%. Core CPI, which omits accommodations and private transportation costs, expanded by 2.2% in August, the quickest pace since September 2024, also matching projections. The rise was driven primarily by escalating energy import costs, which subsequently triggered price surges across goods and services in the city-state.

Retail, food, and housing inflation surged in August, while utility costs soared by 8.7%. Strong demand conditions, amplified by Singapore's booming artificial intelligence-driven technology exports, also fueled inflation. The Monetary Authority of Singapore and Ministry of Trade and Industry cautioned in a joint statement that global oil prices remain high and volatile, and adverse weather conditions could diminish agricultural yields, thereby elevating imported food prices.

They warned that risks to the inflation outlook remain predominantly in the direction of disruptions and warned that inflation may persist longer than anticipated if technology-driven demand continues to rise.