Inflation has likely reached its peak and is expected to ease for the rest of the year, according to Trade and Industry Minister Lim Hng Kiang.
Assuming there will be no further oil price hikes, inflation should stay within three and four percent.
“This means CPI (consumer price index) inflation, which rose by 5.2 percent on a year-on-year basis in the first two months of 2011, is expected to moderate from now on,” Mr. Lim told Parliament.
He was responding to Madam Cynthia Phua (Aljunied GRC) and Madam Ho Geok Choo (West Coast GRC), who wanted to know if inflation projections have changed, following higher food and oil prices driven by a series of catastrophes in the Middle East and Japan.
Singapore’s inflation reached a two-year high of 5.5 percent in January, before moderating to five percent in February. This raised concerns about its impact on cost of living.
Economists, however, expressed mixed views on whether the inflation projection has changed in the past two months.
According to Irvin Seah, a DBS Bank economist, oil prices could still rise in the next few months and complicate the inflation status.