DBS: Singapore Core Inflation to Remain Modest Amid Weak Global Trade

DBS: Singapore Core Inflation to Remain Modest Amid Weak Global Trade

Singapore’s core inflation is expected to remain modest through the rest of 2025, according to DBS senior economist Chua Han Teng. In a recent research note, Chua attributed this trend to restrained imported inflation and a weaker pass-through of business costs to consumer prices.

Data for April showed Singapore’s core Consumer Price Index (CPI) rising 0.7% year-on-year, slightly higher than March’s 0.5% increase. Despite the uptick, Chua maintains that inflation risks remain tilted to the downside.

This outlook aligns with the Monetary Authority of Singapore’s (MAS) continued dovish stance. Chua highlighted that any further moderation in global trade could hurt Singapore’s export-driven economy, weakening labor demand and slowing wage growth domestically.

Given Singapore’s high reliance on global demand and trade flows, ongoing economic softness abroad could continue to place downward pressure on domestic inflation through reduced employment momentum and cost sensitivity in key sectors.