Singapore’s inflation held at 1.8% in May, below forecasts, but energy costs pose upside risks to prices ahead.
The USD/SGD pair rose 0.3% to 1.2970, extending gains since mid-June amid broader U.S. dollar strength. The move reflects persistent pressure on the Singapore dollar as global monetary tightening supports the greenback.
Singapore’s May inflation remained at 1.8% year-on-year, unchanged from March and April, but missed Bloomberg’s consensus forecast of 2.0%. Core CPI, excluding private transport and accommodation, rose 1.4%, also below expectations. Services inflation moderated, offsetting higher food and transport costs.
Authorities warned of rising inflation risks due to delayed pass-through of energy costs in global supply chains. While domestic labor cost pressures ease, prolonged energy bottlenecks or input shortages could fuel imported inflation. Weaker global growth may counterbalance these pressures.