SINGAPORE--Singapore's core inflation reached a nearly two-year high in August as price increases accelerated for services, goods and food ahead of the central bank's October meeting.
Core CPI, which excludes accommodation and private-transport costs, rose 2.2% from a year earlier, the fastest pace since September 2024, when it rose 2.8%. The core reading accelerated from 2.0% in July reported last month and matched the forecast in a Wall Street Journal poll.
The Monetary Authority of Singapore is scheduled to announce its quarterly policy decision by Oct. 14. The MAS doesn't set an explicit inflation target, but considers core inflation just below 2% consistent with price stability.
The headline consumer-price index rose 2.3% from a year earlier, government data showed. The reading was up from 2.2% in July and in line with the WSJ poll. Headline prices rose 0.6% from July.
The pickup reflected faster price increases for services, retail and other goods, as well as food, the MAS and the Ministry of Trade and Industry said in a joint statement.
The authorities expect both core and headline inflation to average 1.5% to 2.5% in 2026. They expect core inflation to remain elevated into 2027 before easing more noticeably around midyear, potentially helped by lower global energy prices.
Core inflation likely remained milder than what the MAS expected when it tightened monetary-policy settings in July, said Barclays economist Brian Tan in a note.
Barclays expects the central bank to raise the slope of its SGD NEER policy band "very slightly" in October, though a hold remains a close call.
Strong growth amid the artificial-intelligence boom hasn't brought a comparable rise in core inflation, raising questions about how much monetary tightening the growth warrants, Tan said.
Sector Index Weighing % Change YoY Housing & Utilities 29.38% +1.3 Food 20.42% +2.3 Transport 13.07% +8.1 Recreation, Sport & Culture 5.95% +1.0 Education 5.79% -0.7 Misc Goods & Services 4.38% +2.6 Information & Communication 3.81% -4.3