, Singapore

High structural inflation is here to stay: DBS

Singapore has to accept the harsh reality.

According to DBS, domestic inflationary pressure is expected to remain higher than usual. Even if the drop in COE premiums were to bring about a significant easing in the headline number, other fundamental drivers of inflation and their effects will continue to be felt on the ground. 

Such inflation pressure is structural in nature and will prove to be more persistent than its cyclical form.

"High structural inflation is here to stay. This is part of the transition cost that the economy is bearing as it seeks to restructure and wean itself from the dependence on low-waged foreign labour," DBS said.

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