Last year, we saw Consumer Price Index (CPI), a measure of inflation, rose by 6.5 per cent over 2007 due mainly to higher costs of food, housing, transport & communication. CPI inflation peaked at 7.5 per cent increase in June 2008. This high rate is due mainly to surging oil prices and food prices since beginning of year.
The inflationary situation has reversed as the financial and economic crisis took the world by storm since September last year. Oil prices have fallen from a peak of US$147 per barrel last year to US$50 per barrel now, thus reducing costs of items requiring energy to produce.
The latest CPI for March 2009 showed a decrease of 0.4 per cent over February 2009. March figure reduction is due largely to lower costs of housing, transport & communication. This is the fifth month in a row when the CPI dipped on a month-on-month basis.
This meant good news for consumers who have to live frugally due to diminishing personal wealth and risks of job layoffs.
Despite the month-on-month dip in CPI, the CPI for the first quarter of this year is still 2.1 per cent higher compared to the same quarter in 2008 (year-on-year comparison). This number is still not alarming when we compare it to 6.5 per cent CPI inflation for whole of last year.
(Source: Singapore Department of Statistics, Press Release, 23 April 2009)
Written on 4/24/2009 4:25 PM
Copyright © 2009, the author known as LKT in Singapore.
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