Data released yesterday showed that Singapore’s economy expanded at its fastest pace of 5.2 percent year-on-year in more than three years in the third quarter, versus a median estimate of 5 percent, and that the recovery has broadened out from export industries to the services sector.
GDP rose seasonally adjusted, annualized 8.8 percent from the previous quarter, higher than an earlier estimate of 6.3 percent, and the government raised its forecast for growth this year to as much as 3.5 percent from 2 to 3 percent, and up to 3.5 percent for next year.
The labor market remains somewhat weak amid sluggish hiring, although it showed improvement in the third quarter from earlier this year.
The Monetary Authority of Singapore (MAS), the city-state’s central bank, and the Singaporean Ministry of Trade and Industry said in a joint report that wage pressures would remain subdued in the near term as previous slack in the economy is absorbed.
The central bank left its policy stance unchanged last month, but gave itself room to tighten if necessary, MAS Deputy Managing Director Jacqueline Loh (羅惠燕) told reporters, adding that last month’s stance remains appropriate and that the regulator would continue to monitor developments.
A separate report showed that the consumer price index (CPI) continued to pick up, although it remained moderate. The CPI rose 0.4 percent compared with a median estimate of 0.5 percent, with core CPI rising 1.5 percent, in line with analysts’ estimates.
Singapore’s export growth is set to taper off next year, with International Enterprise Singapore, the government’s trade promotion body, forecasting an expansion of zero to 2 percent next year, compared with the estimated 6.5 to 7 percent for this year.
Bloomberg economist Tamara Henderson said that on a GDP-expenditure comparison, net exports were a slightly stronger drag on growth, but that this was offset by much stronger household spending.
Public spending was also much stronger, and the contraction in investment was not as large, Henderson said, adding that if this is sustained in this quarter and next quarter, the central bank is likely to dial back its monetary stimulus.
Government data showed that manufacturing surged almost 35 percent in the third quarter from the previous three months, while the services industry grew an annualized 3.2 percent.
Construction continued to suffer, contracting for a third quarter by 5.3 percent, the data showed.
“We also see signs that the recovery is broadening,” with business services and retail looking better even though growth in the third quarter was “primarily supported by manufacturing,” Singaporean Ministry of Trade and Industry Permanent Secretary Loh Khum Yean (羅錦賢) told reporters.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to