Tuesday, March 25, 2008

Inflation is up 6.5%

These are the Singapore inflation rates for 2008:
January: 6.6%
February: 6.5%

Again the news reported the inflation in a "positive" way. Compared to last month, inflation is up 0.5%. However compared to Feb last year, it is up a whopping 6.5%! But do not forget... February was a very short month. Recreation and Others jumped up higher compared to last month.

Inflation should be persistently higher for the first half of 2008, before gradually going downwards due to the higher base inflation in the last half of last year. Inflation will definitely be more than 5% for year 2008.

With the current economic growth for 2008 tipped to be below 5% this year, this is one of the rare times where inflation is higher than economic growth. Not good at all. I just hope that this does not become common.

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