Singapore core inflation rises to 2.2% in August, seen elevated until mid-2027

Implications

Facts

According to August consumer price data released by the Ministry of Trade and Industry (MTI) on 23 September 2026, MAS core inflation was 2.2% year on year, up from 2.0% in July, and 0.3% month on month. Headline (CPI-All Items) inflation was 2.3% (up from 2.2% in July), and 0.6% month on month (source: MTI). ¹ The increase reflected faster inflation in services, retail and other goods, and food (source: MTI).

Electricity and gas prices rose 8.7% year on year in both July and August, mainly because of the regulated electricity tariff increase in July 2026 (source: AsiaOne). MTI and MAS expect both core and headline inflation to average 1.5–2.5% in 2026, with core staying elevated until early 2027 and easing from around mid-2027 as energy prices settle. Upside risks are energy supply disruptions and weather-driven food prices; downside risks are tighter global financial conditions and slower AI-related investment (source: AsiaOne, reporting the joint MTI–MAS release). ²

Analysis

By component, electricity and gas inflation (8.7%) is roughly four times core (2.2%), so the added burden falls disproportionately on households for whom utilities are a larger share of spending. July's regulated tariff increase will keep pushing up prices for some time, which is why the authorities expect elevated inflation until mid-2027. Even as the growth outlook for Southeast Asia is revised up, Singapore households continue to face cost-of-living pressure.

Counterpoints and uncertainties

The official forecast spans a range; if energy prices settle sooner, the elevated period could be shorter. If nominal wage growth outpaces inflation, the effect on repayment capacity would be limited.