Singapore inflation rises to near two-year high in July

Singapore reported that consumer inflation accelerated to 2.2% year-on-year in July, marking its highest level in nearly two years. Despite this rise from 1.9% in June, the figure fell short of the 2.3% increase projected by economists.

The acceleration was primarily driven by higher electricity costs resulting from increased energy prices linked to the war in Iran. However, core inflation, which excludes private transport and accommodation, rose to 2%, lower than the forecasted 2.2%. On a month-on-month basis, the consumer price index saw a slight decline of 0.2%.

The Monetary Authority of Singapore had previously implemented a surprise monetary tightening in July, citing risks of rising imported inflation from fuel and electronic components. In response to the regional conflict, the government has deployed support packages totaling approximately 2 billion Singapore dollars, including cash handouts and tax rebates. Additionally, Singapore has significantly upgraded its full-year 2026 GDP growth forecast to a range of 4.5% to 5.5%.