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Singapore to allow more cars in move to slow inflation
May 30, 2012 / 10:08 AM / 5 years ago

Singapore to allow more cars in move to slow inflation

SINGAPORE (Reuters) - Singapore will allow its car population to grow at a faster pace in the next few months, it said on Wednesday, a move expected to ease inflationary pressures in the city-state.

Ferrari cars are seen during a display of luxury cars in Singapore December 7, 2008. REUTERS/Vivek Prakash

Inflation in Singapore accelerated to 5.4 percent year-on-year last month, with private road transport prices rising 8.2 percent.

Private road transport, which includes car prices, has a 11.66 percent weighting in the consumer price index (CPI.L).

The Land Transport Authority LTA.L said it will allow the vehicle population to grow at an annualised pace of 1 percent from August 2012 to January 2013, before slowing the pace to 0.5 percent per annum.

Singapore’s car population is around 600,000, excluding taxis. The lighter restriction translates each month to an additional 390 certificates of entitlement (COEs) that motorists need to own a car in Singapore, according to the LTA.

The LTA had originally planned to reduce the vehicle growth rate to 0.5 percent from the current 1.5 percent per annum from August, causing a spike in the cost COEs.

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Reporting by Kevin Lim; Editing by Daniel Magnowski

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