Singapore's inflation at 1.8%, lower than expected

SINGAPURA - Singapore’s headline inflation for April 2026 was recorded at 1.8%, lower than the previous forecast of 2%.

Singapore’s inflation was driven by smaller increases in services, retail, and other goods.

Core inflation, excluding private transport and accommodation costs, came in at 1.4%, below the expected 1.7%.

However, Singapore’s Ministry of Trade and the Monetary Authority of Singapore (MAS) said import cost pressures are expected to rise and spread in the coming months.

MAS forecasts headline and core inflation to remain between 1.5% and 2.5% for 2026.

eToro market analyst Zavier Wong described the figures as a mild positive surprise.

He added that progress in Middle East peace talks and recent declines in oil prices could credibly lead to lower import costs by year-end.

Singapore previously revised its Q1 2026 GDP growth significantly to 6%.

This marked an increase from the initial estimate of 4.6% and exceeded Reuters’ forecast of 5.1%.

The ministry stated annual growth for 2026 is projected at 2-4%, amid energy-related disruptions in the Strait of Hormuz.

In April, MAS tightened monetary policy for the first time in nearly three years due to inflation outlook.

Unlike most countries, Singapore does not use interest rates to manage monetary policy but instead directs the Singapore dollar’s exchange rate within a policy band against a basket of currencies weighted by trade.

The Singapore dollar is managed within a set policy band, the exact level of which is not disclosed.