SINGAPORE'S June inflation held at 7.5 per cent, below expectations but still hovering at a 26-year high, on a rise in housing and food costs.

From the previous month, the consumer price index rose 0.4 per cent after seasonal adjustments, the Department of Statistics said in a statement on Wednesday.

Thirteen economists in a Reuters poll had forecast that the data would show that annual inflation rose to 8 per cent - the highest level since February 1982 when inflation hit 9 per cent.

On a three-month moving average, the CPI rose by 0.4 per cent in June - slightly lower than May.

Compared to a year ago, inflation was 7.5 per cent due higher primarily to higher costs of food, housing and transport and communication.

Food prices rose by 9.2 per cent as a result of dearer cooked food, rice & other cereals, milk products, cooking oils, seafood, fresh poultry and vegetables.

Housing costs increased by 13.4 per cent because of higher accommodation costs and electricity tariffs.

With dearer petrol and higher taxi fares more than offsetting lower car prices and road tax, costs of transport and communication rose by 5.1 per cent.

Healthcare costs rose by 5.8 per cent because of increases in hospitalisation fees, charges for medical consultation and specialist services, and more expensive Chinese herbs.

Excluding accommodation costs, the consumer price index rose by 6.5 per cent in June against a year ago.

The consumer price index for the first half year was 7.1 per cent higher compared with the same period last year.

Compared to May, housing costs fell by 1.7 per cent due mainly to lower service and conservancy charges - thanks to the rebates given out by the Government in June.

Prices of clothing and footwear dropped by 3.2 per cent because of cheaper ready-made garments and footwear during the Great Singapore Sale.

The costs of transport and communication also fell by 0.2 per cent due mainly to lower car prices.

In contrast, food prices rose by 0.6 per cent over May because of dearer cooked food, rice and fresh fish. Recreational costs also went up by 0.3 per cent because of more expensive holiday travel.

Excluding accommodation costs, the consumer price index edged up by 0.1 per cent over May 2008.