Consumer prices may rise more than 6.5 per cent in the first half of the year. But, according to Trade and Industry Minister Lim Hng Kiang, the inflation rate is expected to go down in the second half of 2008.
Singapore's inflation rate has been hovering at its highest level in 26 years. This has been fuelled by a rise in prices of food and raw materials. Last week, the Monetary Authority of Singapore said that it would allow the Singapore dollar to rise in a bid to fight inflation.
Speaking on the sidelines of a biomedical conference on Tuesday, Mr Lim said: "Our measures to tackle inflation covers a wide range. First, of course, is through the exchange rate - that is our main lever.
"But at the same time, we also tackle supply constraints - whether it's office space, commercial space or wages through our flexibility in our labour markets."
For now, the government is maintaining its forecast for inflation to remain in a range of between 4.5 per cent and 5.5 per cent this year. - CNA/vm
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