Singapore hits 12-year high

Singapore hits 12-year high
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Singapore´s Consumer Price Index (CPI) hit a 12-year inflationary high of 2.6% in July as the increased Goods and Services Tax (GST) were felt alongside soaring housing costs and inflated food prices.

The CPI rose by 2.1% over June 2007 and 2.6% slump, compared with July last year, Singapore´s Department of Statistics said in a statement on Thursday. It also noted that housing costs reflected the most growth at 4.9% due to higher electricity tariffs, rental prices and maintenance charges but upward movement was seen in all areas.

The increase surpassed the expectations of Dow Jones economists who estimated a 1.8% rise in a Newswires poll. July´s figures represent the fastest CPI increase since January 1995. Food prices, including vegetables, fruit, fish and milk powder increased 1.4% while health care rose 2.2%

Higher fees at universities and commercial institutions led to a 2.1% increase in the education and stationary sector, at a time when Singapore´s government has been debating the construction of a new university to meet consumer demand. The GST increase from 5% to 7% on July 1st was likely a contributing factor, the Department acknowledged.