Core inflation remains the central bank’s key focus as headline inflation hits three-year low
Singapore’s central bank, the Monetary Authority of Singapore (MAS), is expected to maintain its current monetary policy settings at its upcoming meeting on July 26, despite the latest inflation figures showing a decline.
In June, headline inflation unexpectedly dropped to a three-year low of 2.4%, signaling a cooling in consumer price growth. However, core inflation, which excludes private transport and accommodation and is the key metric monitored by MAS, remained at 2.9%, slightly lower than anticipated.
While the decrease in headline inflation may indicate some easing in cost pressures, MAS will likely continue to focus on core inflation as the main determinant for monetary policy decisions. The central bank, along with the Ministry of Trade and Industry (MTI), noted that the official forecast for headline inflation for the full year will be reviewed and updated during Friday’s policy statement.
