Leading investment manager M&G Investments has just released its YouGov Inflation Expectations survey report which contained several noteworthy Singapore and Hong Kong observations
In Hong Kong consumers’ inflation expectations over the short term have risen firmly from 4.0% to 5.0%. This result might also seem surprising given the recent dip in CPI, which fell to 2.8% in April compared to 4.5% March.
Despite the lower CPI reading, home prices in Hong Kong continue to rise to record highs and, unless interest rates are increased, analysts expect inflation to bounce back later in the year. AWT reported recently that Hong Kong property is still on an upward trend.
Perhaps for this reason, 67% of Hong Kong consumers reported concern over rising inflation.
In Singapore, households appear to have become less worried about long-term inflation, with long-term expectations falling from 4.5% to 4.0% this quarter.
Lower oil prices and fluctuating exchange rates may have had some downward impact on consumers’ expectations. Confidence in central bank policy was modestly higher with 55% of Singaporeans declaring they are “very” or “fairly” confident that the correct policies are being pursued to deliver price stability over the medium term.
The survey also found that Singapore is the country with the greatest confidence in its government economic policy (49%) and central bank monetary policy (55%). Confidence levels have grown in recent quarters.
