News: 2019 growth forecast for Singapore’s economy slashed to 0.6%

Sep 5, 2019

The economists expects year-on-year growth to come in at 0.3 percent in the third quarter, citing escalating US-China trade tensions as well as further slowdown in China as top concerns.

Private-sector economists expect Singapore’s economy to grow by 0.6 percent this year, way lower from an earlier forecast of 2.1 percent in June, revealed the latest survey from the Monetary Authority of Singapore (MAS).

This came after the economy expanded by just 0.1 percent in the second quarter of 2019, down from the 1.6 percent projected by respondents in the previous survey.

The economists expects year-on-year growth to come in at 0.3 percent in the third quarter, citing escalating US-China trade tensions as well as further slowdown in China as top concerns.

The most likely outcome is for the city-state’s economy to grow by 0.5 percent to 0.9 percent this year.

With this, economists expect slower growth for the construction sector at 2.7 percent from the previous estimate of 3.5 percent and a sharper decline in the manufacturing sector at 2.4 percent from 0.2 percent previously.

Non-oil domestic exports and wholesale and retail trade are also forecasted to drop by 9.2 percent and 2.8 percent, respectively.

Finance and insurance is the only bright spot in the economy as it is expected to grow by 4.3 percent, up from 3.8 percent in the previous survey.

Moreover, economists expect the CPI-All Items inflation and MAS Core Inflation for 2019 to come in at 0.7 percent and 1.2 percent, down from 0.9 percent and 1.4 percent in the June survey, respectively.

Looking ahead, they expect GDP growth to increase to 1.6 percent for 2020 as a whole.

“The respondents, on average, estimate that the growth outcome for the Singapore economy is most likely to be in the range of 1.0 to 1.9 percent next year. This is lower than the 2.0 to 2.4 percent range in the previous survey,” said MAS.

“CPI-All Items inflation is forecast to come in at 1.0 percent in 2020, while MAS Core Inflation is expected to be 1.3 percent. In terms of the forecast range, CPI-All Items inflation is projected to fall between 0.5 and 1.4 percent, while MAS Core Inflation is expected to come in at 1.0–1.4 percent.”

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Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg

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