Singapore's inflation edges higher in October
Introduction
Nowadays inflation would always be one of the hottest issues people want to talk about. Some may be worried if inflation is high, they cannot afford the price for the same item which was a lot cheaper before. Some may wonder why inflation occurs when his salary is not increased.
So what is inflation? Inflation is the persistent increase in the price of goods and service over a period of time. When the general price level rises, each unit of currency exchanges less goods and services. So it reflects a reduction in the power of purchasing per unit of money. After reading the news article above, I had a clearer view on inflation of Singapore.
Body
Summary of News Article
The news stated that Singapore’s inflation jumped higher in October but it was under market expectation. The Consumer Price Index (CPI) raised 2 percent on-year in October compared to 1.6 percent in September, which mainly caused by the increase of private road transport costs. Other than that, food inflation came in at 2.5 percent in October, and service inflation dropped from 2.7 percent in September to 2.5 percent in October. Accommodation costs also dropped to 1.9 percent. Monetary Authority of Singapore (MAS) core inflation, excluding accommodation and private road transport costs, increased from 1.7 percent in September to 1.8 percent in October. MAS is expecting inflation to stabilize between 2.5 percent and 3 percent in 2013, and 2 to 3 percent next year.
Analysis and Explanation of News Article
Consumer Price Index (CPI) measures the average of the prices paid by urban consumers for a “fixed” basket of consumer goods and services. In the news article it stated that CPI went up 2 percent in October, this was mainly caused by the increase in private road transport costs. This would continue rising over next few months with an average of 1 to 3 percent due to coming re-categorisation of the COE in February. The...