Inflation Continues To Moderate

Singapore July inflation was close to expectations. Headline y/y printed at 4.1% (4.2% was forecast, while the prior was 4.5%). M/M inflation eased -0.2% from 0.5% in June. Core inflation was as expected at 3.8% y/y, prior 4.5%.

• Headline and core y/y momentum continue to move off cyclical highs from mid 2022 and early 2023 respectively.
• In terms of the detail, transport fell -0.7% m/m, along with weakness in clothing and footwear (-1.0% m/m) and housing and utilities (-0.9% m/m). Recreation and culture rose 0.7% m/m and Miscellaneous Goods & Services was up 0.6% m/m.
• In y/y terms, 6 out of the 10 sub categories recorded softer or the same y/y momentum. The strongest y/y pace is in recreation and culture (+6.5%), over taking food prices.
• Headline inflation is projected at 4.5-5.5% this year by the authorities, core at 3.5-4.5%.
• USD/SGD has had little reaction to the print and sits at $1.3560/65. The pair remains well within recent ranges.