S'pore core inflation falls to lowest level in over four years

But some economists expect climb from Q4 amid rising COE premiums and falling rates

- Sheila Chiang Business Correspondent

Consumer price pressures in Singapore eased more than expected in August, with year-on-year core inflation falling to its lowest since February 2021.

While economic uncertainty and government subsidies have lowered inflation, some economists expect inflation to rise from the fourth quarter of 2025, given factors such as rising certificate of entitlement (COE) premiums and falling interest rates.

In August, core inflation dropped for the second month in a row to 0.3 per cent year on year, from 0.5 per cent in July, the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI) said in their joint report on Sept 23.

The reading came in lower than the 0.5 per cent forecast by economists in a Bloomberg survey.

Core inflation excludes private transport and accommodation costs to better reflect the expenses of households here.

Overall or headline inflation was 0.5 per cent, down from 0.6 per cent in July, owing to lower accommodation inflation and core inflation. The economists polled had forecast no change in the gauge.

MAS and MTI said Singapore's imported inflation should remain moderate in the near term as inflationary effects from ongoing trade conflicts are likely to be offset by weaker global demand.

"Global crude oil prices remain below year-ago levels, while food commodity price increases should also stay contained. On the domestic front, slower nominal wage growth and continuing increases in labour productivity should contribute to a moderation in unit labour costs," they said.