, Singapore

Core inflation feared to sink into the red as growth slows

The headline print will be -0.2%.

Singapore will remain stuck in the grip of deflation when the Consumer Price Index (CPI) for July is released next week.

According to DBS, Singapore will endure its ninth consecutive month of deflation with the headline number expected to register -0.2% year-on-year for July.

Inflation will remain stuck in the red on back of low energy prices, slowing economic growth, as well as a whole slew of supply side policy measures.

Apart from the headline number, analysts will be closely watching the Monetary Authority of Singapore (MAS)’s core inflation data, which is feared to dip into the red after being dangerously close to zero in the past two months.

“Core inflation has been declining for the past 14 months, on the back of easing growth momentum. A negative core inflation will likely tip the scale towards a policy response from the Monetary Authority of Singapore,” DBS said.

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