SINGAPORE - Singapore households expect inflation to inch up in the year ahead going by the latest findings of a quarterly survey by the Singapore Management University (SMU).
The online survey of a sample of 500 individuals in March shows that consumers now expect a headline inflation rate of 2.79 per cent for the year ahead, up slightly from the 2.74 per cent in December, which was the lowest since the survey started in September 2011.
This is going by the median forecast in SMU's Singapore Index of Inflation Expectations (SInDEx), released on Monday (April 18).
Singapore experienced a sixteenth straight month of deflation after headline inflation or all-items consumer prices dropped 0.8 per cent in February.
But core inflation, which excludes the costs of accommodation and private road transport, rose 0.5 per cent in February, mainly because of higher food prices.
Said SMU: "The low interest rate environment accentuated by the US Federal Reserve's policy stance of slower pace of interest rate hike led to a weakening of the surging US dollar, and consequently benign imported inflation in Singapore despite recovering oil prices.
"On the domestic front, costs pass-through to consumers from supportive labour market conditions have more or less been offset by decreasing COE premiums, accommodation costs and one-off budgetary subsidies like medical benefits under the Pioneer Generation Package, concession on foreign domestic worker levy, waiver of examination fees, etc.
Looking five-years ahead in the SMU survey, consumers expect headline inflation, which includes transport and accommodation costs - of 3.58 per cent - lower than their December forecast of 3.65 per cent and a record low for this survey.