Inflation edges up to 0.7% in September

CGSI maintained its full-year 2025 headline CPI forecast at 1.0% YoY.

Singapore’s inflation edged up in September, with private transport emerging as the primary driver, according to CGS International’s latest Economics Update.

Both core and headline consumer price indices recorded modest increases, slightly above market expectations.

Core inflation rose to 0.4% YoY (from 0.3% in August), whilst headline inflation climbed to 0.7% (from 0.5%). On a month-on-month basis, core prices grew 0.3% and all-items inflation rose 0.4%.

These figures exceeded Bloomberg consensus forecasts, which had projected 0.2% core and 0.6% headline inflation.

The uptick was largely attributed to private transport costs, which accelerated sharply to 3.7% YoY.

This surge was driven by record-high Certificate of Entitlement (COE) premiums in the second September tender—$119,003 for Category A and $136,890 for Category B.

CGSI linked the spike to heightened demand ahead of upcoming changes to the Electric Vehicle Early Adoption Incentive (EEAI) and the Vehicular Emissions Scheme (VES), set to take effect in January 2026.

The firm expects COE prices to remain elevated through the rest of the year, maintaining upward pressure on transport inflation.

Looking ahead, CGSI describes the inflation outlook as “balanced.” Whilst geopolitical tensions could lead to higher import and shipping costs, softer global demand and easing oil prices may provide some relief.

The Monetary Authority of Singapore (MAS) projects oil prices to decline more gradually in 2026, and upcoming U-Save rebates are expected to help buffer households against a 0.3% quarter-on-quarter rise in electricity tariffs by SP Group.

CGSI maintained its full-year 2025 headline CPI forecast at 1.0% YoY, in line with MAS’s stated range of 0.5% to 1.0%.