Business

Consumer prices rise in fifth consecutive month

Consumer prices went up again last month - the fifth month in a row of increase - although the pace has slowed a little.

Headline inflation was 0.4 per cent last month, down from 0.7 per cent in March, largely because the disbursement of service and conservancy charge rebates cut the cost of housing maintenance and repairs.

However, core inflation - which strips out accommodation and private road transport costs to better gauge everyday expenses - rose to 1.7 per cent last month, the highest level since October 2014.

This was due to an 18.7 per cent increase in the cost of electricity and gas, which rose on the back of higher oil prices.

The Ministry of Trade and Industry and the Monetary Authority of Singapore noted in a joint statement yesterday that crude prices have risen from last year's trough and are likely to average higher this year.

However, they added, upward pressures would be capped by elevated inventories as well as rising US crude oil production.

Ms Selena Ling, OCBC Bank's head of treasury research and strategy, noted that the bank had pared its forecast for oil to around US$55 (S$76) a barrel, as it expects the Organisation of Petroleum Exporting Countries to extend its oil production cuts.

"We tip core inflation to continue to climb and extend beyond the 2 per cent year-on-year level before the year is out, but full-year core inflation is still likely to average 1.6 per cent year-on-year for this year," she said. - THE STRAITS TIMES

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CONSUMERSMINISTRY OF TRADE AND INDUSTRY (MTI)oil