24th September 2007, 09:16 PM
Singapore Aug Inflation Jumps
SINGAPORE (Dow Jones)--Singapore's consumer prices rose at their fastest pace in almost 13 years in August, boosted by the one-time impact of a sales tax hike in July.
The consumer price index rose 2.9% from a year earlier after rising 2.6% in July, the Department of Statistics said in a statement Monday. Economists polled by Dow Jones Newswires forecast an average increase of 2.8%.
The data reflect mounting price pressures from the city-state's tight labor market, but the central bank remains wary of external risks to economic growth and is unlikely to adopt a tighter monetary policy at its next review in October.
"With a lack of a convincing recovery in exports, the government will probably be a little reluctant to tighten policy," said Robert Prior-Wandesforde, an economist at HSBC.
The Monetary Authority of Singapore uses exchange rate targeting as its chief investment tool, and has advocated a modest, gradual appreciation of the Singapore dollar since April 2004.
August's rise was the largest since the 3.6% increase in November 1994, and was driven mainly by higher costs of food, cars and healthcare.
On month, the index increased 0.3% in seasonally adjusted terms, just above the forecast for a 0.2% rise. The index rose 1.5% in July from June
Last edited by raincool2005; 24th September 2007 at 09:18 PM.