Singapore inflation levels out in June

Singapore's consumer prices levelled out in June after rising steadily each month since February, government data showed on Friday, but economists expect more price rises in the months ahead.
The Department of Statistics said the consumer price index was unchanged from May and up 2.3 percent from a year earlier - a 13th month of gains and reflecting a tumble in prices last year during the Severe Acute Respiratory Syndrome outbreak.
Both figures were in-line with market forecasts.
From May, food prices rose 0.1 percent due mainly to a rise in the cost of seafood, while clothing prices fell 2.7 percent during the city-state's annual Great Singapore Sale. Housing, transport and communications and health care costs were stable.
Except for February when prices unexpectedly dipped 0.2 percent from January, the index has been flat to higher since June last year when Singapore's $93 billion economy rebounded from the effects of a deadly outbreak of the SARS virus.
The modest return of inflation, along with the rapid pace of economic expansion, led the central bank to tighten monetary policy in April by allowing a "modest and gradual appreciation" of the Singapore dollar.
The Singapore dollar hit a 4-year high of 1.6605 per dollar on April 13, the day after the MAS tightened policy, but then weakened as far as 1.73 by mid-May. It has strengthened a little since then but remained mostly on the weak side of 1.70.
Economists expect prices to edge up in coming months, supported by volatile oil prices and strength in Singapore's economy, which grew at a strong annualised 9.1 percent rate in the second quarter from the March quarter.
Economists have mostly revised their forecasts for full-year growth to above the government's forecast of 5.5 percent to 7.5 percent, which would mark the best growth in four years.
Analysts expect the annual inflation rate to hover around two percent until at least July when the data will no longer be distorted by the impact of the SARS outbreak on prices last year.
The Monetary Authority of Singapore raised its outlook on inflation in April to a range of 1.5 to 2.0 percent this year, up from 0.5 to 1.5 percent.