SINGAPORE: Private-sector economists have maintained their growth forecast for the Singapore economy this year at 3.2 per cent, the latest quarterly survey from the Monetary Authority of Singapore (MAS) showed on Wednesday (Sep 5).
This falls within the Government’s estimates for full-year gross domestic product to come in at between 2.5 and 3.5 per cent. Official data released last month showed the economy grew at a slightly better-than-expected 3.9 per cent in the second quarter from a year ago.
AdvertisementSince the last survey in June, economists have raised their expectations for economic indicators, such as manufacturing, accommodation and food services, as well as private consumption.
The manufacturing sector is expected to remain a key driver of the economy, with growth expected to be 7.6 per cent, up from 5.3 per cent in the previous poll.
On the other hand, the other indicators that had a downward revision in their 2018 forecasts are finance and insurance, wholesale and retail trade, and construction.
The outlook for the construction sector saw the biggest downgrade, with respondents tipping a contraction of 4.2 per cent. The previous survey flagged a contraction of 2.1 per cent.
AdvertisementAdvertisementAmong the 23 economists polled, trade protectionism continues to be the biggest downside risk for the Singapore economy ahead.
It was cited by 89 per cent of respondents, up from 84 per cent in the previous survey, with further escalation of trade rhetoric by the US and its trading partners, as well as the implementation of announced tariffs causing concern.
Meanwhile, there are also growing worries about weaker external growth due to tightening liquidity conditions in emerging markets. This risk was cited by 42 per cent of respondents, up from 11 per cent in the previous quarter's survey.
The number of respondents that named slower growth in China as a downside risk also increased to 37 per cent, from 21 per cent, on the back of tightening credit conditions.
Economists have also become less optimistic about the outlook of the domestic property market, due in part to the recent cooling measures. Just 26 per cent of the economists cited it as a possible upside risk, compared to 47 per cent in the June survey.
Meanwhile, the forecasts for both headline and core inflation in 2018 are at 0.7 and 1.7 per cent, respectively.
On the labour front, economists expect the unemployment rate to be at 2.1 per cent at year-end, unchanged from the previous survey.
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