The Singapore Index of Inflation Expectations by the Sim Kee Boon Institute for Financial Economics at SMU indicates that Singaporeans’ one-year-ahead median inflation expectations rose by 50bps from 2.97% in December 2017 to 3.43% in March 2018. This is due to a faster rate of normalization of US monetary policy and a heightened threat of a trade war among US and major economies. The survey noted that compared to the historical median headline inflation expectations average of 3.44%, the current one-year-ahead median headline inflation is till marginally lower. However, it is still marginally higher than the recent first quarter average of 3.41% for the one year ahead headline inflation expectations.
The latest study by SMU found that Singaporeans expect an overall slowdown of the inflation rate, which will go down to 3.23%. The study was conducted by the SMU Sim Kee Boon Institute for Financial Economics on 500 local consumers. They pinpointed some of the reasons for the slowing down of the economy.