Singapore's inflation last month held near the highest since 1982, signaling the central bank may allow the currency to strengthen to contain price pressures.
The consumer price index jumped 6.5 percent from a year earlier, after gaining 6.6 percent in January, the Department of Statistics said yesterday. Economists had estimated a 6.8 percent increase. Prices rose 0.5 percent from January.
The Singapore dollar this month rose to an all-time high versus the US currency, helping reduce import costs even as food and energy prices rose. The Monetary Authority of Singapore, which expects inflation this year to gain at more than double last year's pace, will release its twice-yearly review of the currency next month.
"It makes sense for the central bank to keep its stance of allowing the currency to appreciate as it will help the economy cope with imported inflation," said Alvin Liew, an economist at Standard Chartered Bank in Singapore. "Still, there are also domestic sources of inflation and other measures may be needed to bring that down."
The Singapore dollar has gained 3.4 percent this year. The central bank -- which has sought a "gradual and modest" strengthening in the currency since April 2004 -- said in October it would allow a "slightly" faster appreciation in the Singapore dollar.
The city-state's currency fell 0.3 percent to S$1.3903 against the US dollar as of 1:15pm.
Singapore's central bank expects inflation to average between 4.5 percent and 5.5 percent this year, after gaining 2.1 percent last year.
"The underlying momentum in inflation remained stable," the government said in a statement yesterday.
Food prices, which make up 23 percent of the index, rose 6.7 percent last month from a year ago, following January's 5.8 percent increase. From January, food prices gained 1.3 percent.
Rising prices of daily food essentials have prompted the government to roll out a campaign which included newspaper and television advertisements to encourage consumers to switch to cheaper frozen meats from fresh ones.
Transport and communication costs, the second-biggest component at 22 percent of the consumer price index, climbed 7.6 percent last month from a year earlier. From January, transport and communication prices fell 0.1 percent.
Oil prices breached US$110 a barrel this month, increasing fuel and transport costs for consumers. The Singaporean government doesn't subsidize pump prices, leading gasoline companies to pass on the rising gasoline and diesel costs to car owners.
Housing costs, the third-largest component of the price index, climbed 8.8 percent from a year ago. Housing prices rose 0.5 percent. from a month ago.
BACK IN THE NEIGHBORHOOD: The planned transit by the ‘Baden-Wuerttemberg’ and the ‘Frankfurt am Main’ would be the German Navy’s first passage since 2002 Two German warships are set to pass through the Taiwan Strait in the middle of this month, becoming the first German naval vessels to do so in 22 years, Der Spiegel reported on Saturday. Reuters last month reported that the warships, the frigate Baden-Wuerttemberg and the replenishment ship Frankfurt am Main, were awaiting orders from Berlin to sail the Strait, prompting a rebuke to Germany from Beijing. Der Spiegel cited unspecified sources as saying Beijing would not be formally notified of the German ships’ passage to emphasize that Berlin views the trip as normal. The German Federal Ministry of Defense declined to comment. While
‘UPHOLDING PEACE’: Taiwan’s foreign minister thanked the US Congress for using a ‘creative and effective way’ to deter Chinese military aggression toward the nation The US House of Representatives on Monday passed the Taiwan Conflict Deterrence Act, aimed at deterring Chinese aggression toward Taiwan by threatening to publish information about Chinese Communist Party (CCP) officials’ “illicit” financial assets if Beijing were to attack. The act would also “restrict financial services for certain immediate family of such officials,” the text of the legislation says. The bill was introduced in January last year by US representatives French Hill and Brad Sherman. After remarks from several members, it passed unanimously. “If China chooses to attack the free people of Taiwan, [the bill] requires the Treasury secretary to publish the illicit
A senior US military official yesterday warned his Chinese counterpart against Beijing’s “dangerous” moves in the South China Sea during the first talks of their kind between the commanders. Washington and Beijing remain at odds on issues from trade to the status of Taiwan and China’s increasingly assertive approach in disputed maritime regions, but they have sought to re-establish regular military-to-military talks in a bid to prevent flashpoint disputes from spinning out of control. Samuel Paparo, commander of the US Indo-Pacific Command, and Wu Yanan (吳亞男), head of the People’s Liberation Army (PLA) Southern Theater Command, talked via videoconference. Paparo “underscored the importance
The US House of Representatives yesterday unanimously passed the Taiwan Conflict Deterrence Act, which aims to disincentivize Chinese aggression toward Taiwan by cutting Chinese leaders and their family members off from the US financial system if Beijing acts against Taiwan. The bipartisan bill, which would also publish the assets of top Chinese leaders, was cosponsored by Republican US Representative French Hill, Democratic US Representative Brad Sherman and seven others. If the US president determines that a threat against Taiwan exists, the bill would require the US Department of the Treasury to report to Congress on funds held by certain members of the
RSS