RHB Bank has adjusted its 2026 headline inflation forecast for Singapore, reducing it from 2.5% to 2.2%, whilst maintaining the core inflation forecast at 2.0%. This revision comes as the bank anticipates the inflation trajectory to be influenced by global commodity price movements, increased electricity and gas tariffs, and potential food inflation risks.
In August, Singapore’s headline inflation rose to 2.3% year-on-year, slightly up from 2.2% in July, aligning with market expectations. Core inflation also saw an increase, reaching 2.2% from the previous month’s 2.0%. Barnabas Gan, Group Chief Economist and Head of Market Research at RHB Bank, noted these figures in the bank’s latest Global Economics and Market Strategy Report.
The Monetary Authority of Singapore (MAS) is expected to tighten its policy further in October by increasing the Singapore dollar nominal effective exchange rate (S$NEER) appreciation gradient to 1.50%. However, the likelihood of further tightening has diminished, according to Gan.
These adjustments reflect the bank’s response to evolving economic conditions and underline the importance of monitoring commodity prices and domestic cost pressures. The report suggests that whilst inflation remains contained, vigilance is necessary to manage potential risks in the coming months.
