MAS: Core inflation in Singapore rose to 1.6% in June amid higher prices of food, retail goods and services

SINGAPORE: Singapore’s core inflation edged up to 1.6% in June, reversing May’s slower pace as households paid more for food, services and retail goods.

Overall inflation also increased slightly to 1.9%, according to data released by the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MTI) on July 23.

The latest figures matched market expectations. Monthly price growth stayed steady, suggesting inflation is still easing compared with previous years, even though some day-to-day expenses continue to rise.

Higher global energy prices recorded between April and mid-June will also begin feeding into Singapore’s regulated electricity tariff from July.

Food and services led June’s price increase

Food prices recorded one of the biggest increases during the month. Inflation in the category rose from 1.8% in May to 2.1% in June, with both groceries and prepared food becoming more expensive.

Services inflation also climbed, rising from 1.3% to 1.5%. The increase was primarily due to higher airfares and holiday travel costs during the June school holiday period.

Retail and other goods inflation edged up to 1.7%, driven by larger price increases for furniture and recreational items. Accommodation inflation also rose slightly as housing rents increased at a faster pace.

One area that eased was private transport. Inflation slowed from 8.6% to 8.4% because petrol prices rose less sharply than before.

Electricity and gas prices continued to fall compared with a year earlier, although the decline became slightly smaller than in May.

Higher electricity costs are expected from July

MAS and MTI said households are expected to feel the impact of higher global energy prices in the coming months.

Singapore’s regulated electricity tariff is calculated using average natural gas prices from the first two and a half months of the previous quarter. Because energy prices were higher between April and mid-June, those costs will only start appearing in electricity tariffs from July.

The authorities also noted that electricity prices in the Open Electricity Market declined more slowly in June, adding to the smaller fall in electricity-related consumer prices.

Inflation outlook still carries risks

Both core inflation and overall inflation are expected to average between 1.5% and 2.5% in 2026, keeping within the official full-year forecast.

Global energy prices are still higher than they were in 2025. Over time, those costs could ripple through supply chains, raising production and transport costs for imported goods and services.

At home, wage growth is expected to moderate while consumer spending may become more cautious amid economic uncertainty, which could help limit price increases.

Inflation risks still lean to the upside if global energy supplies recover more slowly than expected or if shortages continue in regional supply chains. At the same time, weaker global economic activity could reduce inflationary pressure.

Middle-income households felt the biggest price increases

Separate figures from the Department of Statistics showed prices rose across all income groups during the first half of 2026.

Middle-income households experienced the highest inflation, at 1.8%, compared with 1.6% for higher-income households and 1.2% for lower-income households.

Food, cars, health insurance, accommodation, and petrol contributed most to the higher cost of living.

Lower-income households saw the smallest increase partly because they spend less on cars and petrol. They also benefited from expanded Ministry of Education financial assistance, lower preschool fee caps and higher healthcare subsidies, which helped offset rising costs in other areas.

Inflation has eased significantly from recent highs, but the latest figures show that everyday essentials continue to cost more. While slower inflation is welcome, it doesn’t mean prices are falling; it just means they’re rising at a slower pace.

Careful budgeting will still help until wage growth consistently keeps up with living costs for households.