DJ PREVIEW: Singapore Inflation May Have Peaked In June (ZT)

DJ PREVIEW: Singapore Inflation May Have Peaked In June



(This article was originally published Tuesday.)


By Diana Wang
Of DOW JONES NEWSWIRES


SINGAPORE (Dow Jones)--Inflation in Singapore probably peaked in June as food and energy costs continued to rise ahead of a widely expected slowdown in the second half.

A Dow Jones Newswires poll of economists forecast the consumer price index to have risen 7.9% from a year earlier after increasing 7.5% in May.

Forecasts for the data, due Wednesday at 0500 GMT, ranged from 7.5% to 8.3%.

Economists said June's uptick was driven mainly by a continued rise in imported food and oil costs.

"The spike in oil prices in early June led to higher prices at the pump, for the 13th time since last July," said Leon Hiew, an economist at Citigroup in Singapore.

Higher transportation costs as well in neighboring Malaysia may have contributed to rising food prices. "More than two-thirds of Singapore's food imports come from Malaysia and the higher costs of transportation (there) will surely result in higher retail food prices here," said Irvin Seah, an economist at DBS in Singapore.

But annual inflation is expected to ease in the second half due to a high base caused by a sales-tax hike implemented last July.

The poll forecast the June CPI to have risen 0.7% from May in seasonally adjusted terms, after rising 0.3% the previous month.


Singapore's June CPI Forecasts - % Change
On Year On Month Adj

HSBC 7.5% -
Fortis Bank 7.7% -
Action Economics 7.8% 0.5%
JPMorgan 7.8% 0.6%
CIMB 8.0% 0.8%
DBS 8.0% -
OCBC 8.0% 1.2%
Citigroup 8.3% -
Median 7.9% 0.7%
May 7.5% 0.3%

-By Diana Wang, Dow Jones Newswires; 65 6415 4154; diana.wang@dowjones.com



(END) Dow Jones Newswires

July 22, 2008 20:00 ET (00:00 GMT)

Copyright (c) 2008 Dow Jones & Company, Inc.