RTTNews - Consumer prices in Singapore registered an unexpected decline in April, the first such fall in almost four years, owing to lower prices of housing as also transport and communication, official data showed Monday.
The Department of Statistics said in a report that the consumer price index dropped 0.7% year-on-year in April, after rising 1.6% in March. Economists expected prices to increase 0.7%. This is the first drop in consumer prices since June 2005.
In April, transport and communication, with the second highest weight in the index, dropped 6.3% on an annual basis. This was followed by a 1.7% fall in housing prices and a 0.3% drop in prices of recreation. However, food prices, with the maximum weight in the index, rose 3.6%.
Month-on-month, consumer prices were down 1.1% in April, following a 0.4% fall in March. Prices of most categories declined, however, prices of healthcare as also transport and communication increased in the month. Excluding accommodation costs, the consumer price index slipped 0.9%. After seasonal adjustments, consumer prices declined 1.5% on a monthly basis in April.
The Monetary Authority of Singapore in its latest report on April 14 said cost pressures were decreasing in the economy, and this was being reflected in the easing headline inflation rate. At the same time, the central bank said headline inflation could temporarily turn negative in the coming months due to the high base in 2008. The MAS has kept the inflation forecast for 2009 unchanged at between minus 1% and 0%.
Last week, data released by the Ministry of Trade and Industry or MTI, showed that the Singapore economy contracted a revised 14.6% in the first quarter, slower than a 16.4% fall in the fourth quarter. The MTI noted that there were still no decisive indicators of economic recovery and hence lowered the growth forecast in April. The ministry said the economy could now contract between 6%-9% this year, after a decline of 2%-5% estimated in January.
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