Singapore’s core Consumer Price Index (CPI) experienced a notable rebound in December 2025, rising by 0.4% month-on-month, according to UOB Global Economics and Markets Research. This increase follows a slight decline of 0.1% in November and translates to a 1.2% year-on-year rise, aligning with Bloomberg’s consensus but slightly below UOB’s forecast of 1.3%.
The uptick in core CPI was largely attributed to holiday-related demand, with significant contributions from sectors such as clothing and footwear, other transport services, food, and recreation. Notably, airfares surged by 10.4% month-on-month, reflecting a stronger-than-seasonal increase. Land transport services also saw a rise, partly due to a 5% hike in bus and train fares effective from 27 December 2025.
Headline CPI increased by 0.3% month-on-month in December, driven by the same core components, whilst accommodation costs remained stable and private transport costs decreased. Despite the momentum, UOB notes that much of the increase is temporary, with limited signs of a broad-based price pickup.
UOB maintains its 2026 core and headline inflation forecasts at 1.5%, with potential upward risks due to a reduction in the Certificate of Entitlement (COE) supply and a 3% decline in household electricity tariffs for the first quarter of 2026. The Monetary Authority of Singapore (MAS) is expected to update its inflation forecasts in the upcoming Monetary Policy Statement on 29 January, with potential adjustments to the core and headline inflation forecast ranges.
