Housing and utilities provided a massive drag.
Consumer prices in Singapore has shown no signs of slowing down from its downward trend, and this month, housing and utilities proved to be the biggest drag.
According to an analyst report from Maybank Kim Eng, housing and utilities remained the largest contributor to deflation during the month, on back of persistent sluggish rental cost and imputed rentals on owner-occupied accommodation as the housing rental market remains soft.
Meanwhile, transport cost also stayed low as private road transport gathered pace at -1.8% yoy.
“The higher pump prices as compared to the same period last year was more than offset by the drop in car prices (due to cheaper COE premium),” Maybank Kim Eng said.
Analysts added that this is also in addition to the one year road tax rebate for petrol vehicles to ease the burden on higher petrol duties.
On the other hand, core inflation has kept its head above water, remaining over the zero line.
“Core inflation rate (CPI ex-accommodation and private road transport) edged up the pace at +0.4% YoY (Dec 2015: +0.3% YoY), as the impact of smaller reduction in electricity tariffs and higher food and retail goods inflation more than offset the fall in services inflation,” Maybank Kim Eng said.
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