Due to the unexpected hike in housing and car prices, the Monetary Authority of Singapore (MAS) has raised its inflation forecast by one percentage point to four to five percent.
The consumer price index (CPI), which eased to 4.5 percent in April and May, is “expected to creep back up to slightly above five percent for the next couple of months before slowly trending down towards the end of the year,” remarked Ravi Menon, Managing Director of the MAS.
He added that due to growing economic uncertainty in the US and Europe, the central bank and the Ministry of Trade and Industry will review their economic growth forecast for 2011.
“For now our sense is that the five to seven percent forecast range remains intact.”
“If we had reported our profit and loss in an international currency like the US dollar, it would show a healthy profit,” he noted.
Meanwhile, MAS reported a record S$10.9 billion overall loss attributed to the robust Singapore dollar depleting investment gains of S$12.3 billion.
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