Singapore’s economy grew more than initially estimated in the fourth quarter of last year as manufacturing improved, even as the outlook for this year is clouded by an uneven global recovery.
GDP grew an annualized 4.9 percent in the three months through December last year from the previous quarter, when it rose a revised 2.6 percent, Singapore’s Ministry of Trade and Industry said in a statement yesterday.
That compares with an estimate last month of a 1.6 percent gain and the median forecast of 2.2 percent in a Bloomberg News survey of 13 economists.
A plunge in oil prices is generating more disposable income in the US, Singapore’s third-biggest export destination.
The Monetary Authority of Singapore unexpectedly eased policy last month, sending the currency to the weakest level since 2010 against the US dollar.
“The manufacturing revision is in line with the trend we’re seeing across the region because of better demand from the US,” Barclays PLC Singapore-based economist Leong Wai Ho (梁偉豪) said.
“It looks like a year of steady growth momentum for Singapore, supported by the positive impact of lower oil which we expect will be felt later in the year,” Leong added.
The Singaporean dollar gained 0.1 percent to S$1.3558 per US dollar at 9:16am yesterday. It has weakened more than 2 percent so far this year, making it among the worst performers in Asia of 11 currencies tracked by Bloomberg.
Singapore’s economy expanded 2.1 percent in the fourth quarter from a year earlier, after growing 2.8 percent in the previous three months, the Ministry of Trade and Industry said yesterday. The median estimate in a Bloomberg survey was for a 1.7 percent gain.
The economy grew a revised 2.9 percent last year, the ministry said, compared with an earlier estimate of 2.8 percent. The Singaporean government reiterated its expansion forecast of 2 to 4 percent for this year.
“The global economic outlook has softened in recent months,” the ministry said in a statement.
“The pace of recovery is also likely to remain uneven across the economies, with the US economy being the main bright spot” and sectors such as manufacturing and wholesale trade likely to face headwinds, it said.
Exports fell 0.7 percent last year, a separate release showed. Shipments are forecast to grow between 1 and 3 percent this year.
The outlook for monetary policy remains “appropriate” and unchanged, Monetary Authority of Singapore deputy managing director Jacqueline Loh (羅惠燕) said at a news conference.
Singapore’s manufacturing contracted an annualized 2.5 percent in the fourth quarter from the previous three months, data showed, compared with an initial estimate of a 5.8 percent drop. Construction gained 2.2 percent, while services grew 7.8 percent in the same period.
“The labor market is expected to remain tight, with low unemployment and rising vacancy rates,” the ministry said. “As a result, labor-intensive sectors such as construction, retail and food services may see their growth weighed down by labor constraints, while others such as business services are expected to remain resilient.”
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