Inflation to rise in Singapore

Trade and Industry Minister Lim Hng Kiang. -- ST PHOTO: ASHLEIGH SIM

Well, it is about time that the Singapore economy shows signs of heating, as evident in Mr Lim Hng Kiang's address to the Parliment on Monday.
I was just as surprised to find that our CPI has only increased at an annual rate of 1% over the last three years. Surprisingly, the teh tarik and the kopi had a price increase by almost 15% over the last year. Well maybe teh tarik and kopi just did not make it to the CPI basket. Guess the folks in MTI may have substituted hot beverages with hot tap water.

'We look at an inflation forecast of between 1 to 2 per cent this year, which is a little higher than our previous years, but definitely still reasonable, considering that this is more than 16 quarters of growth,' Mr Lim told MPs.

Given MAS' exchange rate policy for keeping inflation in check, expect a modest strengthening of the Singapore dollar against our main trading partners like U.S, EuroZone and Malaysia.