ECONOMY | Staff Reporter, Singapore

Don’t expect core CPI to bounce back in February: OCBC

It’s poised to stay in negative territory.

There seems to be no indication that Singapore’s consumer price index will break its streak of 14 straight months in negative territory, according to analysts.

According to an analyst report from OCBC, CPI will continue to stay below zero at -0.8% amid deflationary pressures in crude oil prices and domestic asset prices.

Meanwhile, core CPI may accelerate to 0.8% yoy in Jan 16, the highest since March 2015.

“[It will] likely give second thoughts to market speculation of another potential monetary policy easing in mid-April,” OCBC said.

On the other hand, OCBC said 4Q16 GDP growth estimate will likely be revised down to 1.8% yoy from the flash estimate of 2%.

“It would be interesting to see if the official 2016 GDP growth forecast of 1-3% would be revised at this juncture, or policymakers would simply note the downside growth risks for this year,” OCBC said.

“Industrial production on 26 Feb could continue to contract by 6.6% yoy (-1.7% mom sa), which would underpin the manufacturing weakness in 1Q16,” they added.

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