Central banks worldwide have embarked on a campaign to cushion the effects of rising prices following Russia's invasion of Ukraine last year that hammered oil and gas supplies. THE BUSINESS TIMES - Get the Latest Business & Financial News Core inflation on a month-on-month seasonally adjusted annualised basis fell sharply from a peak of 9.1 percent in June 2022 to 3.6 percent in May 2023, he said. "Growth will remain weak in the near term," he said. What Investors Are Discussing atSummer Parties, Artificial IntelligenceCompanies Hunt for San Francisco Offices, Iran Tries to Seize Oil Tankers Near Strait of Hormuz, AP Says, UK Tells FCA to Step Up Review of Bank Rules for Politicians, Rural India Adding Super Rich Faster Than Urban, Study Shows, Berlusconi Family to Retain TV Business, Pledges to Stay United, More Than 10,000 Fans in Wimbledon Queue as New Joiners Warned of Long Waits, Lamborghini Buyers Race to Own Carmakers First Plugged Model, Frankenstein Chemicals Are Even Worse Than Forever Chemicals. The MAS kept its forecast for the Singapore economy to grow by 0.5 to 2.5 per cent this year, down from 3.6 per cent in 2022. Taking into account the one-off impact of the GST increase, core inflation should come in at around 3.5per cent to 4.5 per cent over 2023, and headline inflation at 5.5per cent to 6.5 per cent. Meanwhile, headline inflation is expected to be Singapore MAS also maintained its core inflation forecast which excludes accommodation and private transport costs at around 2.5 to 3 per cent year-on-year. Menon said inflation has "clearly peaked and has discernibly moderated". Xinghui previously covered Asia for the South China Morning Post and has been in journalism for a decade. While analysts told Reuters the inflation seen in January was largely due to the one-off effect of the sales tax hike and seasonal effects associated with the Lunar New Year, they are split on the implications for MAS' monetary policy review due in April. The Monetary Authority of Singapore building. WebLatest Consumer Price Developments Consumer Price Developments Published Date: 23 May 2023 Consumer Price Developments in April 2023 This April 2023 report contains Sign up for free newsletters and get more CNBC delivered to your inbox. SINGAPORE By the end of the year, prices of domestic goods and services will rise at a slower pace than previously expected, said the Monetary Authority of Singapore (MAS) chief Ravi Menon on Wednesday (July 5), while debunking the myth that an inflow of assets from ultra-wealthy persons has been driving up costs in Singapore. Singapore's manufacturing sector makes up the largest portion of its GDP, standing at 21.6% of nominal GDP in 2022. Singapore Central Bank Sees Record Net Loss On Inflation Fight However, inflation is expected to "slow more discernibly" in the second half of this year and end the year significantly lower. Meanwhile, core inflation that strips away accommodation and private transport costs and better reflects the expenses of Singapore households may prove to be surprisingly stubborn. Mr Menon said the easing of global supply chain frictions as well as the decline in global energy and food commodity prices have already turned Singapores import price inflation negative and that should remain so over the rest of the year. GST will be raised by 2 percentage points in two stages. Singapore This was up from 3.8 per cent in the second quarter. MAS added that a sharper decline in final demand moving forward could presage an inventory correction of end-products, which would exacerbate the fall-off in sales of intermediate semiconductor inputs, and in turn worsen the oversupply of chips. Accelerate is an in-depth exploration of the science, ethos and implications of near-future transportation methods. Gross domestic product would be at the mid-point of the 0.5% to 2.5% range expected this year, down from 3.6% in 2022, because Singapore remained exposed to a global slowdown and geopolitical uncertainties, MAS Chairman Tharman Shanmugaratnam said in a report accompanying the annual review. Bloomberg Surveillance, covering the latest news in finance, economics and investments. Commentary: After 5 rounds of tightening, is there no other choice for MAS but to stay aggressive on monetary policy? MAS' next scheduled policy review is in October. The decline in global energy and food prices should weigh on the costs of intermediate and final consumer goods, and the strengthening Singapore dollar will further dampen imported inflation, said Mr Menon. Growth in investment demand for technology equipment in the US also slowed considerably since its peak last year, it said. Singapore economy to slow further in 2023 amid global Excluding the effects of the GST increase, core and headline You have reached your limit of subscriber-only articles this month. Read this subscriber-only article for free! Canada's main stock index fell at open on Wednesday, with technology and financial stocks leading declines, while investors awaited minutes from the U.S. Federal Reserve's June meeting due later in the day. In May, headline inflation came in at 5.1 per cent, down from a peak of 7.5 per cent in September 2022. I want to calculate how much the item under the category that costs. The authority will be encouraging such offices to conduct philanthropic activities through Singapore by recognising donations to local charities alongside normal business spendings. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. Understand the various initiatives for technology solutions and projects in Green Finance. MCI (P) 076/10/2022, MCI (P) 077/10/2022. The industry leader for online information for tax, accounting and finance professionals. The central bank explained that while inflation is still elevated, its tightening moves have "tempered the momentum of price increases.". (Photo by Roslan RAHMAN / AFP) (Photo by ROSLAN RAHMAN/AFP via Getty Images), Singapore can't avoid a recession, economist says. This article is now fully available for you, Please verify your e-mail to read this subscriber-only article in full. The MAS has tightened its policy stance strengthening the Singapore dollar in the process five times since October 2021. Headline inflation slowed to 4.7% in May compared to the 5.4% recorded in the first quarter. The gift link for this subscriber-only article has expired. For Singapore, end demand for electronics products has pulled back in the countrys top two markets China and the United States amid high inflation, tighter financial conditions and consumers pivoting to spending on services. Inflation MAS, in the annual report, said inflation in the last six months of 2023 should slow further as imported costs are reduced and the current tightness in the domestic labour market eases. inflation Singapore https://www.reuters.com/world/asia-pacific/even-singapore-lifts-gay-sex-ban-lgbt-families-feel-little-has-changed-2022-11-29/ However, he noted that the fight against inflation is not over and the monetary policy stance needs to remains tight. Across most categories, prices have increased across the board, including communications which The remaining 30 percent of the loss, or 9.0 billion Singapore dollars, was due to net interest expenses from MAS' money market operations to mop up excess liquidity in the banking system, he said. Core inflation has been high as businesses have raised prices at a firm pace to rebuild margins that were eroded by sharp increases in costs earlier. Specifically, banks in Singapore are well-capitalised with sound liquidity positions, underpinned by a stable and diversified funding base.. WebConsumer Price Developments in March 2023 Summary MAS Core Inflation fell to 5.0%on a year-on-year (y-o-y) basis in March, from 5.5% in February. Published by SPH Media Limited, Co. Regn. That move surprised economists, who had expected a sixth straight round of tightening in a streak that had included two off-cycle moves in 2022. Brian Tan at Barclays said the January inflation data was largely in line with MAS' own forecast and expected the central bank to make no changes to monetary policy this year. Why a $1.5 trillion source of corporate financing is choking on higher rates, Chief of Russias Yandex faces court case for LGBT propaganda', Oil industry should set carbon targets at COP28 -TotalEnergies CEO, Prince Harry fights for trial in hacking case against Murdoch's UK group, Duke Energy to sell distributed generation portfolio in $364 million deal. He said that besides a slowing down of the price increases in accommodation and transport, imported inflation should also remain negative over the rest of the year. Singapore Inflation Rate Thats a Bargain. Likewise, single family offices and their foreign employees account for a tiny proportion of car purchases in Singapore.. All quotes delayed a minimum of 15 minutes. Headline inflation rose to 7.5 per cent. This rate of return is reviewed annually and is subject to the Presidents concurrence.. The industry leader for online information for tax, accounting and finance professionals. We want to hear from you. These currency translation effects have no impact on the international purchasing power of the OFR, or on MAS ability to conduct monetary policy and support financial stability, the central bank said. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. A Philanthropy Tax Incentive Scheme for family offices was also launched on Wednesday, which will allow qualifying donors in Singapore to claim 100 per cent tax deduction, capped at 40 per cent of the donors' statutory income, for overseas donations made through local intermediaries. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. Core inflation is expected to remain elevated in the first half of next year, before moderating more discernibly in the second half as cost pressures ease and demand conditions soften, MAS said. MAS sees inflation easing in second half of 2023; effect of GST hike 'transitory', All done! Singapore The Monetary Authority of Singapore (MAS) on Wednesday raised its end-2023 forecast for core inflation to 2.5 to 3 per cent, up from an estimate of around 2.5 Electricity and gas and non-cooked food inflation also rose, reflecting the effects of the step-up in global energy and agricultural input costs compared with a year ago. 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As such, it will maintain the prevailing rate of appreciation of the exchange rate policy band, known as the Singapore dollar nominal effective exchange rate, and there will be no change to its width or the level at which it is centered. Speaking at a media conference on the MAS Annual Report and Sustainability Report for 2022 and 2023, Mr Menon said that the authority is lowering its forecast for the consumer price index (CPI) of all items to 4.5 to 5.5 per cent for 2023, down from 5.5 to 6.5 per cent previously. The MAS projected core inflation to reach about 2.5% by the end of 2023. Global chip sales contracted 3 per cent year-on-year between July to August, leading the industry into a consolidation phase. In all, MAS recorded a net loss of $30.8 billion for the financial year. MAS chair says will keep focus on medium-term price stability, Most analysts see the central bank tightening again Friday. Mr Tharman announced in June that he had decided to run for the post of the nations president. https://www.barrons.com/news/singapore-central-bank-sees-record-net-loss-on-inflation-fight-d4ffaaad. Firms will continue to hire non-residents to fill manpower gaps, particularly in sectors such as construction, marine shipyard and process. The Monetary Authority of Singapore (MAS) on Wednesday raised its end-2023 forecast for core inflation to 2.5 to 3 per cent, up from an estimate of around 2.5 per cent made in April. Singapore's January core inflation rises 5.5%, fastest in 14 years Singapore manages monetary policy through exchange rate settings and not interest rates. In comparison, core inflation, which excludes the costs of accommodation and private transport, is expected to average around 4 per cent this year, with headline inflation at around 6 per cent. MAS said that rising interest rates worldwide and slowing global growth had also raised the risk to financial stability outlook. Mediacorp Pte Ltd. All rights reserved. Inflation hurts. But White House economists find that it's even WebThe Consumer Price Index in Singapore increased 0.30 percent in May of 2023 over the previous month. For 2023, taking into account all factors including a hike in the Goods and Services Tax (GST), core and headline inflation are projected to average between 3.5 and 4.5 per cent, and 5.5 to 6.5 per cent respectively. o This was driven by lower inflation for services, food and retail & other goods. $200 TrillionIs Needed to Stop Global Warming. Singapores CPI-All Items inflation or headline inflation rose by 6.3% y-o-y and 0.6% m-o-m. inflation This is because the concept of such offices in Asia is still much newer and hence not as established compared to those from the US and Europe. Mr Menon said that negative currency translation effects are not a cause for concern and it does not make sense to try and avoid them. This will cause core inflation to rise in Q1 2023, but its impact should be temporary, said MAS. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. Jonathan Ferro drives you through the market moving events from around the world on Bloomberg's The Open. However, it expects that tighter financial conditions globally will lead to an intensified drag on global investment and manufacturing. The Monetary Authority of Singapore, which uses the exchange rate rather than interest rates to stabilize prices, probably will signal on Friday that its seeking a stronger local dollar to curb imported inflation pressures, according to 12 of 22 analysts surveyed by Bloomberg. The translation effects are a consequence of MAS exchange rate-based monetary policy, which centres around the strength of the Singapore dollar. In part due to those adjustments, this harmonized inflation metric compiled by the CEA finds that that annual US inflation peaked at around 10% last summer when Xinghui leads the Singapore bureau, directing coverage of one of the regions bellwether economies and Southeast Asia's main financial hub. The negative currency translation effects and interest expenses reflect the consequential cost of carrying out MAS function as a central bank which is to conduct monetary policy conducive to sustained non-inflationary economic growth, he said. High interest expenses from mopping up excess liquidity in the banking system resulted in a further loss of $9 billion. Meanwhile, other factors, such as the progressive wage model for low-wage workers, will add short-term boosts to wage growth. 2023, 7:16 AM UTC. MAS books largest loss of $30.8b in effort to fight inflation, All done! Data is a real-time snapshot *Data is delayed at least 15 minutes. UK Sells Government Bonds at Highest Yield Since 2007, Hong Kong Police Arrest Four Ex-Members of Demosisto: SCMP, JPMorgan Sees Risks of 7% Interest Rate and Hard Landing in UK, Foreign Investments In Ireland Hit by Stiff Competition, Tech Slowdown, UK Considers Sarah Breeden for Bank of England Deputy Governor, Law Firms Are Recruiting More AI Experts as Clients Demand More for Less, Biden's New Student Debt Relief Plan Will Likely Face Legal Challenges, Twitter Settles Retaliation Claim Over Return to Office Protest, NetEases 85% Stock Comeback Defies Chinas Slowdown, Metas Threads App Wont Launch in EU on Regulatory Concerns, US to Curb China Access to Cloud Services Like Amazon, WSJ Says, Will AI Take My Job? "The effects of MAS' monetary policy tightening are still working through the economy and should dampen inflation further," it added. For the full year, MAS core inflation is expected to average 3.5% to 4.5%, with headline inflation estimated to be between 5.5% and 6.5%. Likewise for construction, labour shortages and elevated costs of construction materials will weigh on the outlook even as activity continues to pick up in 2023. Why are OPEC+ supply cuts failing to boost oil prices? Maybank economist Chua Hak Bin said the central bank must not lose focus on combating inflation. Contact us, WAN-IFRA Digital Media Awards Worldwide 2022. Notably, the slowdown in global manufacturing demand could act as a drag on the domestic sectors workforce expansion, given the spillovers through worldwide supply chains, particularly in electronics production. MAS said core inflation this year has risen more than expected, with the July to August average coming at 4.9 per cent year on year. Although the 1 percentage point increase in the GST will result in a one-off step-up in the price level, its effect on inflation should be transitory, MAS said on Friday in its biannual monetary policy statement. As Singapores core inflation is expected to remain above the symbolic 2.0% handle from now to 1H2023, Gan is still of the view that the Monetary Authority of Singapore (MAS) may further tighten its monetary policy in April 2023. Singapores Central Bank Says Inflation Fight Isnt Over Yet This means that the countrys trade-related sector will continue to see subdued growth in the quarters ahead, the MAS wrote in its report. The other 30 percent of the loss came from the MAS's "net interest expenses from money market operations to mop up excess liquidity in the banking system". The ministry noted there was an output contraction across all manufacturing clusters, except for transport engineering. Copyright 2023 SPH Media Limited. Climate-related investments globally will also be recognised for the purpose of assessing if a family office has met its investment requirement, Mr Menon announced. Mr Menon added that the authority has been providing tax incentives to single family operators to help create jobs, generate demand for domestic service providers and channel capital towards local enterprises. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. A Reuters poll of economists had forecast a 5.6% increase in January. SINGAPORE -The Monetary Authority of Singapore (MAS) has givenits first assessment of inflation in 2023, saying the pace of price increases will ease in the second half of next yearand that the effect of the upcoming goods and services tax Holiday Air Traffic Was Awful. "Overall, core inflation is expected to remain high in the first half of 2023 before slowing more discernibly in the second half as cost pressures gradually ease.". MAS books largest loss of $30.8b in effort to fight inflation Goods & Services Inflation Calculator. Got a confidential news tip? "Excluding the impact of the GST (Goods and Services Tax) hike, year-end core inflation would be closer to 2 per cent, said Mr Menon. No. WebInflation Rate in Singapore is expected to be 5.10 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. This story was produced by AFP. Singapore's central bank said Wednesday it suffered a record annual net loss of US$23 billion in the most recent financial year as it tightened monetary policy to battle soaring inflation, and it warned the city-state's economy still faced headwinds. SINGAPORE, July 5 (Xinhua) -- The Monetary Authority of Singapore (MAS) posted a net loss of 30.8 billion Singapore dollars (22.8 U.S. dollars) for the 2022 To continue, upgrade to a supported browser or, for the finest experience, download the mobile app. US Stocks Fall as China Data Saps Risk Appetite: Markets Wrap, China Restricts Export of Chipmaking Metals in Clash With US, Odeys Hedge Fund Empire Is Disintegrating Bit by Bit, Bank of America Says it Started Talks With Fed After Stress Test Results, Taylor Swifts Singapore Gig Frenzy Propels UOB Card Signups. "There is considerable uncertainty around the outlook for both inflation and growth," it added. Monetary Authority of Singapore However, compared with the previous quarter, GDP contracted by 0.7%, the first contraction since the second quarter of 2022. "This is the largest loss MAS has ever recorded," he added. About 70 per cent of the net loss, or S$21.4 billion, was due to a rising Singapore dollar, resulting in negative currency translation effects in MAS Official Foreign Reserves (OFR). Also, amid conducive demand conditions, businesses are expected to raise prices further to pass on the imported and domestic costs that have accumulated within production chains in Singapore and abroad.
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