Business

Expect S'pore economy to be sluggish

Despite renewed momentum in the property sector, Singapore's economy is likely to be sluggish in coming months, in line with prospects for the world as a whole, said banking group Credit Suisse.

This comes amid weak oil prices and a competitive telecommunications sector. Export demand is expected to deteriorate as well, which will hit the Singdollar, said Credit Suisse's mid-year prognosis.

"Manufacturing companies would be most affected by (the drop in export demand). Beyond that, I think that if you look at domestic sectors - retail, auto - it has been quite weak already," said Credit Suisse's Asia Pacific investment strategist for equities Suresh Tantia.

Prospects of more interest rate rises in the US are also expected to weigh on the Singdollar, which Credit Suisse believed is likely to weaken against the greenback.

Rates are tipped to go up at least one more time this year and three times each in the next year and 2019.

The US dollar is expected to do well against the euro amid subdued inflation there and a cautious European Central Bank.

Credit Suisse said the yen still remains "the best vehicle" to hedge against global risks. - THE STRAITS TIMES

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