Singapore Q3 GDP Growth Seen Revised up on Exports Boon
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Year-on-year, third quarter final gross domestic product (GDP) was forecast to show growth of 5.0 percent, according to the poll’s median estimate of 11 economists, an improvement from the 2.9 percent growth for April-June.
The data will be released on Thursday, November 23.
“Growth prospects are getting brighter for the Singapore economy after two years of sub-par performance,” analysts at ANZ bank said in a research note to clients.
Recent data pointed to a more broad based recovery for the city-state, dispelling previous worries that Singapore was too dependent on its tech products.
Earlier on Friday, Singapore reported that its exports rose the most in 2-1/2 years in October, thanks to growth in both its electronics and non-electronics exports.
“The composition of growth (in 2018) is going to be more balanced,” compared to that so far this year, said Credit Suisse economist, Michael Wan.
Singapore and other trade-dependent Asian economies enjoyed a strong tailwind from improved global demand in the past year, particularly for electronics products and components such as semiconductors.
“This year was more about exports, but as we move to 2018, you would see more support from things like retail sales and private consumption,” Wan said.
The positive growth and inflationary impulse from the trade sector has raised the prospect of tighter monetary policy next year.
The Monetary Authority of Singapore held policy steady last month but changed a reference to maintaining current settings for an extended period, a shift that analysts said created room for a tightening next year.
“We expect the Monetary Authority of Singapore (MAS) to exit from their neutral policy stance at their October 2018 meeting,” ANZ analysts said.
Reuters
Questions & Answers
Q.What was the estimated annual growth rate for Singapore's GDP in the third quarter?
What was the estimated annual growth rate for Singapore's GDP in the third quarter?
Economists predicted the third quarter final gross domestic product would show growth of 5.0 percent year-on-year. This represented an improvement from the 2.9 percent growth recorded for April-June, according to the poll's median estimate.
Q.Which sectors contributed to Singapore's significant export growth in October?
Which sectors contributed to Singapore's significant export growth in October?
Singapore's exports rose substantially in October, marking the most significant increase in 2-1/2 years. This growth was driven by a strong performance in both the electronics and non-electronics export sectors.
Q.What is expected to drive Singapore's economic growth in 2018?
What is expected to drive Singapore's economic growth in 2018?
While exports were a key driver this year, Credit Suisse economist Michael Wan anticipates more support from retail sales and private consumption in 2018. This suggests a more balanced composition of growth next year.
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