Singapore's CPI seen rising 1.4% y/y in May: Reuters poll

[SINGAPORE] Singapore's consumer price index in May likely rose 1.4 per cent from a year earlier, a Reuters poll showed, above the previous month's 0.4 per cent increase thanks to a low base for the prior year.

In May 2016, Singapore's headline CPI fell 1.6 per cent on a annual basis, due to lower accommodation costs thanks to public housing service and conservancy rebates given that month.

Nomura economist Brian Tan noted that rebates this year were given in April, rather than May, so last month's inflation is "going to get some base effects from this timing difference".

In May, core inflation likely increased 1.6 per cent from a year earlier, the poll showed, slowing slightly from April's 1.7 per cent, the fastest pace since October 2014.

The Monetary Authority of Singapore's core inflation measure excludes changes in the price of cars and accommodation, which are influenced more by government policies.

Economists said the May CPI numbers aren't likely to shift the central bank's neutral monetary policy stance.

The MAS held policy steady in April, saying a "neutral" stance will be needed for an extended period as it looked to support an economy that contracted in the first quarter from the previous three months.

REUTERS