Singapore's Consumer Prices Fell Unexpectedly in October

By Ronnie Harui

SINGAPORE--Singapore's consumer prices unexpectedly fell in October, mostly due to a sharp drop in the cost of private transport while accommodation inflation eased.

The consumer-price index fell 0.2% in October from a year earlier, compared with 0.0% in September, the Department of Statistics said Monday. The median estimate in a Wall Street Journal survey of seven economists was for a flat reading.

Food prices, which have a 21.10% weighting in the index, climbed 1.7% in October from a year earlier, the data showed.

The cost of transportation, which has an index weighting of 17.07%, dropped 0.6% in October from a year earlier. The cost of housing and utilities, which makes up 24.84% of the index, declined 0.3%.

Core CPI, which strips out private road transport and accommodation costs, fell 0.2% in October following September's 0.1% decline. The median estimate in the WSJ survey was for a flat reading.

External inflation is likely to remain low amid weak demand conditions in major commodity markets and the persistence of negative output gaps in Singapore's major trading partners in the quarters ahead, the Monetary Authority of Singapore and the Ministry of Trade and Industry said in a joint statement Monday.

Domestic cost pressures are expected to stay subdued, with the accumulated slack in the labor market weighing on wages.

Both overall and core consumer prices are forecast to range between a 0.5% decline and a flat reading in 2020, the statement said. For 2021, core consumer prices are forecast to average between 0.0% and a 1.0% rise, while overall consumer prices are projected to range between a 0.5% decline and a 0.5% increase, they added.

Write to Ronnie Harui at [e-mail]

(END) Dow Jones Newswires

11-23-20 0028ET