Singapore's core inflation rate edged down to 2% year-on-year in September, reflecting slower increases in services, retail goods, and private transport costs. This slight relief follows months of steady inflation, as authorities forecast a stable but cautious outlook for the months to come.
- Core inflation dipped from 2.2% to 2% in September
- Lower increases seen in retail, services, and private transport
- Energy and food prices still pose upside risks
What happened
Singapore’s core inflation rate, which excludes accommodation and private transport costs, decreased to 2% year-on-year in September, down from 2.2% in August. The moderation was driven by lower inflation in services, retail items, and private transport. For example, telecommunications saw larger price declines and transport service cost increases slowed, while furniture prices dropped and clothing price rises slowed.
Overall inflation also fell slightly to 2.2% from 2.3%, supported by reduced private transport inflation and continued steady energy costs driven by natural gas prices. However, food inflation ticked up marginally due to higher prices in both non-cooked food and food services. Despite the easing, housing rents and accommodation inflation saw slight increases.
Why it feels good
This easing in core inflation brings some relief for consumers and businesses who have faced rising costs over recent months. Slower increases in everyday essentials such as transport, retail goods, and services help ease the pressure on household budgets, allowing families to better manage expenses.
Additionally, the government’s support through enhanced subsidies in healthcare and education, coupled with ongoing productivity gains within the service sector, is expected to keep domestic inflationary pressures under control in the near term. These measures help maintain economic stability and consumer confidence despite external cost challenges.
What to enjoy or watch next
Singapore is expected to experience slightly elevated core and overall inflation rates through the immediate future before more noticeable easing takes place from mid-2027. Consumers and businesses should stay mindful of potential price spikes driven by global energy and food market fluctuations, which remain key risks.
Looking ahead, many will watch how the government balances support measures with inflation control, particularly if global price pressures persist or accelerate. The interplay between international commodity trends, domestic productivity, and policy responses will be crucial for Singapore’s inflation path in 2027 and beyond.