Inflation in Singapore rose to 5.7 percent from a year ago, according to the Department of Statistics.
The consumer price index (CPI) rate grew faster than the 5.15 percent forecast by Reuters, surging ahead of the 5.4 percent recorded in July, making it the highest since 2008.
The cost of private road transport climbed 12.5 percent due to the increase in Certificate of Entitlement (COE) premiums, housing costs rose 9.9 percent, while food prices increased by a comparatively modest three percent.
CIMB Economist Song Seng Wun noted that what caught everyone off guard was the rise in private road transport costs. He added that “in the housing component the rental revision will start to reflect the cautious environment”.
“The dilemma is this inflation and growth trade-off. With this in mind the Monetary Authority of Singapore (MAS) will want to keep the policy as flexible as possible,” said Wu Kun Lung, an Economist at Credit Suisse.
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