Singapore consumer prices down 0.6% in September, but core inflation up on pricier services and retail items

Shoppers at an NTUC FairPrice outlet at Nex mall on Oct 7, 2015.
Shoppers at an NTUC FairPrice outlet at Nex mall on Oct 7, 2015.PHOTO: LIM YAOHUI FOR THE STRAITS TIMES

SINGAPORE - The negative headline inflation which Singapore has experienced since November last year is showing no signs of letting up.

However, core inflation, which is seen as a better gauge of everyday household expenditures, rose slightly as services and retail products became pricier.

The consumer price index, a measure of headline inflation, fell 0.6 per cent from levels seen in the same month a year ago - the 11th consecutive month of decline and the longest stretch of negative inflation that Singapore has experienced since 2009.

The latest bout of negative inflation is largely the result of cheaper oil and loan curbs that have dampened the property and car markets.

September's fall was in line with economists' estimates, and follows a 0.8 per cent decline in August's consumer price index.

Private road transport costs decreased by 3.2 per cent in September over the same month a year ago, extending the 2.9 per cent fall in August, owing to lower Certificate of Entitlement (COE) premiums and petrol pump prices.

Accommodation costs fell by 2.9 per cent, similar to the decline in the previous month, reflecting the soft housing rental market.

The Monetary Authority of Singapore's (MAS) core inflation measure, which strips out accommodation and private road transport costs to better gauge everyday expenses, rose to 0.6 per cent from August's 0.2 per cent.

This mainly reflected a pickup in the prices of services and retail items, said the MAS and Ministry of Trade and Industry in a joint statement.

Services inflation rose to 0.8 per cent in September from 0.5 per cent in the previous month. This mainly reflected the rise in healthcare services fees and public road transport costs, as the dampening effects of enhanced medical subsidies and SG50-related price promotions dissipated.

The overall price of retail items was 0.6 per cent higher, reversing the 0.6 per cent drop in the preceding month, largely due to more costly clothing and footwear, and household durables.