Inflation rises to 3.4% YoY in February

This is faster following a 2.9% slowdown in January.

The prices of goods and services rose to 3.4% year-on-year in February, data from the Ministry of Trade and Industry (MTI) and Monetary Authority of Singapore (MAS) showed.

Headline or Consumer Price Index-All Items inflation slowed to 2.9% in January. 

This growth was driven by inflation in accommodation, services, and food.

MAS core inflation grew to 3.6% YoY, rising from 3.1% in January, reflecting seasonal effects related to the Chinese New Year.

Per segment, services saw a steeper increase at 4.2% from 3.3% in January due to holiday expenses, whilst accommodation saw the fastest increase at 3.9% from 2.1% in January.

The food segment also increased to 3.8% from 3.3%.

ALSO READ: Inflation eases to 2.9% YoY in January

Meanwhile, electricity & gas slowed to 5.2% from 5.3%, retail & other goods to 1.2% from 1.4%, and private transport to 1.4% from 2.9%.

MTI and MAS said unit labour costs slowed alongside the cooling of the labour market but businesses are still expected to continue passing through higher labour and other business costs to consumer prices at a gradual pace.

“Core inflation is expected to resume a gradual moderating trend over the rest of the year as import cost pressures continue to decline and tightness in the domestic labour market eases,” they said.

For the whole year, MTI and MAS projected that both headline and core inflation will average between 2.5% and 3.5%. Excluding the transitory effects of the goods and services tax hike, they will range between 1.5% and 2.5%.