Singapore July CPI inflation edged up at 1.9%

Singapore's headline inflation went slightly higher to 1.9 percent in July from a year-on-year rise of 1.8 percent in June, mainly due to an increase in private road transport cost after two consecutive months of decline, the city-state's central bank and Ministry of Trade and Industry said on Friday. Singapore's headline inflation registered a three-year low of 1. 5 percent in April. The Monetary Authority of Singapore, the central bank, said the private road transport cost rise was the main drive of the CPI inflation in July, which increased 2.0 percent compared with the 2. 1 percent fall in June, "as car prices picked up following the rise in Certificate of Entitlement premiums in June and the implementation of a new surcharge on some cars under the Carbon Emissions-based Vehicle Scheme". Petrol pump prices also rose in line with the recent uptrend in global oil prices, the central bank added. However, accommodation cost increased at a slower pace of 2.6 percent in July, comparing with the inflation of 4.8 percent in June. Service inflation also eased from 2.7 percent in June to 2.5 percent in July, mainly because of the smaller increases in the cost of healthcare and household services, the central bank's statement said. Food prices rose by 2.1 percent in July, slightly stronger than the 2.0 percent in June. The core inflation monitored by the central bank, which excludes the costs of accommodation and private road transport, slowed slightly at 1.6 percent in July, "as the moderation in services inflation more than offset the higher contribution from food prices." The central bank said that it expects imported inflation to most likely remain subdued this year. Domestic cost pressures are expected to persist amid a tight labor market, and cost pass- through to prices of consumer services could also pick up slightly. The core inflation is expected to rise moderately in the second half and average 1.5 percent to 2.5 percent this year. The full-year headline inflation is expected to be 2-3 percent.