Full Breakdown
Singapore's April Inflation Eases to 1.4% as Energy Costs Loom
5/25/2026, 11:58:18 AM
Core Inflation Data and Immediate Findings
On 25 May 2026 Singapore reported headline CPI of 1.8 % for April, unchanged from March. Core CPI, which excludes private transport and accommodation, fell to 1.4 % from 1.7 %, missing the Bloomberg poll forecast of 1.8 %. Retail and other-goods inflation slowed to 1.5 % (from 1.8 %), services inflation eased to 1.5 % (from 2.1 %), and food inflation held at 1.6 %. Q1 2026 GDP was revised to 6 % from 4.6 %, and full-year growth is projected at 2 %–4 %.
Background
MAS manages the Singapore dollar within a policy band against a trade-weighted basket of currencies, not by interest rates. The inflation data arrive as global energy markets react to heightened Middle-East tensions and Strait of Hormuz disruptions, which MAS and the Ministry of Trade and Industry (MTI) cite as sources of imported cost pressure.
Official Statements & Responses
MAS and MTI said the core-inflation slowdown reflects weaker services, retail and other-goods price growth. They reaffirmed a 2026 inflation range of 1.5 %–2.5 % for headline and core inflation. They warned that higher energy and input costs linked to Middle-East developments could raise production costs for imported goods and services, tilting inflation risks upward. Downside risks include curtailments of industrial production from supply-chain disruptions or tighter global financial conditions, which could dampen activity and lower inflation.
Verbatim Quotes
- “As higher energy and other input costs arising from the developments in the Middle East pass through global supply chains, they will raise production and transport costs for a wider range of Singapore’s imported goods and services.” — MAS and MTI
- “A more persistent disruption to global energy supplies or shortages in key intermediate inputs to regional supply chains could further raise imported costs for Singapore," said MAS and MTI.” — MAS and MTI
- “A curtailment of industrial production due to supply chain disruptions or an abrupt tightening in global financial conditions could lead to a slowdown in economic activity and thus lower inflation,” — MAS and MTI
- “credible path to some imported cost relief” — Zavier Wong, market analyst, eToro
Why It Matters
The core-inflation decline offers relief, yet upside risks suggest future price pressures could return, especially for electricity tariffs tied to natural-gas prices. MAS’s exchange-rate policy may face tighter bands if imported costs rise, affecting corporate pricing and household consumption. Analysts note that cautious consumer spending could moderate demand amid uncertainty.
What’s Next
Regulated electricity tariffs for Q3 2026 will incorporate average natural-gas prices from the preceding quarter, likely reflecting higher global energy costs from July onward. MAS and MTI will keep monitoring global energy supply and regional supply-chain conditions to adjust the policy band as needed.
