Chart of the Day: Inflation growth stagnates in 2018

Price pressure remains subdued despite economic recovery.

This chart from RHB Research shows that Singapore’s headline inflation stagnated in January after hovering at 0.4-0.6% YoY in H2 2017, suggesting that price pressure remains subdued despite a recovery in economic growth.

Even if the core inflation inched up to 1.4% YoY in January from +1.3% in the previous month, it wasn’t that high when compared with the peak of 1.7% recorded in Apr 2017. “This indicates that price pressure remains manageable,” RHB said.

The brokerage expects headline CPI is expected to climb 1.6% in 2018, picking up from 0.6% increase in 2017. “This would be underpinned by improving economic growth, firm commodity prices, rising water tariffs, and a rebound in property prices,” it added.