Economists not ruling out further government support if inflation persists; GST hike likely to stay

SINGAPORE’S inflation appears on track to peak in the third quarter, but economists told The Business Times that further government support should not be ruled out if prices continue to stay elevated beyond that.

“Food prices are starting to fall off from their recent peaks. The relaxation on some export bans on palm oil from Indonesia and fertilisers from Russia will also ease food-price pressures,” said Maybank senior economist Chua Hak Bin.

“Energy prices are highly correlated with food prices, and have also eased from their recent peaks. The global growth slowdown and monetary tightening is leading to some demand destruction and cooling of global commodity prices,” he added.