Singapore’s inflation rate exceeded 5% for a seventh month, and policy makers said prices will remain “elevated.”

The consumer price index rose 5.5% in December from a year earlier, the Department of Statistics said in a statement today. That matched the median estimate of 18 economists surveyed by Bloomberg News. Inflation was 5.7% in November, according to previously reported data. Price gains averaged 5.2% in 2011, the government said.

Singapore’s central bank, which uses the island’s dollar to manage price increases, said in October it will slow gains in its currency, joining other Asian policy makers in trying to juggle inflation pressures with protecting growth amid a faltering global recovery. The Monetary Authority of Singapore and the trade ministry said today that inflation “will likely remain elevated over the next few months” on higher housing rentals and transportation costs.

 

“While we believe inflation will ease to average 3% this year, upside risk remains,” Irvin Seah, an economist at DBS Group Holdings Ltd. in Singapore, said before the report. “As such, we do not expect the MAS to ease off in its exchange rate policy stance.”

 

A slowdown in the Singapore economy may “reduce the tightness in the labor market” and alleviate some cost pressures in the coming months, the central bank and trade ministry said today, in the first such monthly statement on inflation trends and the outlook for price gains.

 

“Barring an escalation of geopolitical tensions in the Middle East that could potentially affect oil prices, inflationary pressures emanating from abroad should also ease, given subdued global growth prospects,” they said.

Singapore’s inflation will average 2.5% to 3.5% in 2012, the central bank and trade ministry reiterated today.

 

Prices were unchanged last month from November, without adjusting for seasonal factors, today’s report showed.