This comes as a result of higher oil prices and concerns that weather conditions will affect the production of food which form Singapore’s key imports.
Prices of essential services are also expected to increase significantly next year with the hike in the foreign domestic worker levy, and with bus and train fares also likely to go up.
The Monetary Authority of Singapore reported this in its bi-annual macroeconomic review released yesterday (26 Oct).
The MAS expects Singapore’s inflation rate to rise to 2 percent for the rest of the year, and maintain at that rate for the first half of 2019.
Employers’ expectations for wage growth could contribute to inflationary pressures.
The MAS expects Singapore’s economy to grow at a slower pace for the rest of this year and in 2019, with GDP registering within the upper half of the 2.5 to 3.5 percent forecase range.