Singapore’s output gap – defined as the economic measure of the difference between the actual output of an economy and its potential – is forecast to widen slightly this year given the strong performance so far and the expectation that GDP will be sustained at high levels in the near term.\u00a0<\/p>\n
In April, the output gap was expected to average around zero per cent for the year.<\/p>\n
Core inflation stood at 1.5 per cent for the second quarter, up from 1.2 per cent in January and February before the Middle East conflict began, noted MAS.<\/p>\n
Imported costs are likely to rise, with higher fuel and electronic input costs lifting prices for construction materials, capital equipment and food commodities.<\/p>\n
“Adverse weather conditions in Singapore\u2019s import sources are expected to lower agricultural output and drive up food prices,” said MAS.<\/p>\n
Domestic price pressures should be contained as sustained labour productivity growth and moderating nominal wage growth will continue to cap unit labour costs increases.<\/p>\n
Electricity and gas inflation is expected to step up, while food, retail and other goods inflation should increase because of imported costs.<\/p>\n
The inflation forecast remains at 1.5 to 2.5 per cent for both core and headline inflation this year. It should ease “more discernibly” in the second half of 2027 as global energy prices gradually moderate, said MAS.<\/p>\n
But there remains significant uncertainty for the macroeconomic outlook. Inflation could worsen if energy prices spike again, said the central bank.<\/p>\n
“Fuel reserves have been drawn down significantly and renewed supply disruptions in the Middle East could cause sharp surges in oil prices,” the monetary policy statement said.<\/p>\n
Inflation could also persist if robust investment growth generates greater demand spillovers in Singapore and abroad.<\/p>\n
On the downside, an unexpected tightening in financial conditions or a pullback in AI-related investment could impact the sustainability of GDP growth and weaken inflation.<\/p>\n","protected":false},"excerpt":{"rendered":"Singapore’s output gap – defined as the economic measure of the difference between the actual output of an…\n","protected":false},"author":2,"featured_media":561286,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,184,85,46,20942,10361],"class_list":["post-561285","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-il","tag-israel","tag-monetary-authority-of-singapore","tag-monetary-policy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/561285","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=561285"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/561285\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/561286"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=561285"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=561285"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=561285"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}