S’pore June CPI rises 0.3 pct s/adj from May

24 Jul 07

Singapore’s consumer prices rose a seasonally adjusted 0.3 percent in June from May, government data showed on Monday, and climbed 1.3 percent from a year earlier, marking their strongest increase in 12 months.

The 1.3 percent increase from a year earlier reflects higher food and transport costs and is the biggest since June 2006, when the consumer price index rose 1.4 percent due to higher food and housing costs.

David Cohen, an economist at Action Economics, said overall inflation remained benign, partly thanks to the strong Singapore dollar, and on target for the government’s 2007 forecast of 0.5-1.5 percent.

But Singapore’s booming property market and surging rents had little impact on the overall index.

Housing costs fell 2.0 percent in June from a year ago, and dropped 2.7 percent from May, which the Department of Statistics said reflected lower maintenance costs and cheaper household durables.

“I remain curious about the housing component. They attribute the decline to lower maintenance. But what about higher rents,” said Cohen.

A sub-index for food, which has the largest weighting in the overall index, rose 1.7 percent in June from a year ago, while transport and communication, the second-biggest component in the index, rose 2.8 percent, the Department of Statistics said in a statement.

The statement does not include seasonally adjusted figures for the sub-indices