SINGAPORE - Singaporeans' one-year-ahead median inflation expectations stayed unchanged at 2.63 per cent, a record five-year low, according to the latest quarterly Singapore Index of Inflation Expectations (SInDEx).
This was the lowest level for all-items inflation since the survey's inception in September 2011. The survey by the Sim Kee Boon Institute for Financial Economics (SKBI) at Singapore Management University (SMU) was released on Monday (Oct 17).
Despite weak global growth prospects and headwinds from political uncertainty in the US and euro zone, representative Singaporean households surveyed believe that one-year-ahead expected price changes seem to be plateauing.
But Singaporeans' expectations for core inflation - which excludes accommodation and private road transportation costs - saw the biggest drop in the survey's five-year history.
Its one-year-ahead median core inflation expectations in September tumbled to 2.47 per cent, from 3 per cent in June, its lowest ever recorded average since the survey's inception.
More significantly, for a subgroup of the population who own their accommodation and use public transport, the one-year-ahead median Singapore core inflation rate for the subgroup also dropped to its historic low of 2.3 per cent in September compared to 2.9 per cent in June.
"These results strongly indicate that there has been a significant drop in the perception of future price changes in the Singapore core inflation rate excluding housing and private road transportation, possibly due to a prolonged slump in prices of everyday items," the survey concluded.