Business

Private sector economists lower Singapore growth forecast

They now expect expansion of 2.5%, down from 2.6% tip made in December

Private sector economists have again lowered their economic growth forecast for this year.

They now expect expansion of 2.5 per cent, down a touch from the 2.6 per cent tip made in December.

The forecast yesterday came from the Monetary Authority of Singapore quarterly survey, which polled 23 economists and analysts last month. It is within the Ministry of Trade and Industry's forecast for growth ranging from 1.5 per cent to 3.5 per cent, with expectations it will come in "slightly below the mid-point" of this range.

Economists' forecasts have declined for a number of sectors since the December poll, including manufacturing, finance and insurance, wholesale and retail trade and accommodation and food services.

Construction was the only segment that saw a surge in positive sentiment, with the growth estimate rising from 1.5 per cent in December to 2.1 per cent.

Despite estimates of a slight dip in overall growth, respondents noted that an easing of trade tensions between China and the US could contribute towards stronger-than-expected expansion here.

Stronger growth in China and a pause in monetary tightening were also cited as potentially positive growth factors.

The risks were a mirror image to the possible benefits.

Trade protectionism was listed as the top concern by respondents, followed by a further slowdown in China and higher interest rates.

Respondents expect the unemployment rate to tick up to 2.2 per cent by the end of the year, from 2.1 per cent in the previous survey.

A further slowdown in China was the next biggest worry, followed by higher interest rates.

Expectations for headline inflation and core inflation both dipped in the latest survey.

Headline inflation is expected to come in at 1.1 per cent, down from an earlier prediction of 1.3 per cent in December.

Core inflation is tipped at 1.7 per cent, down from the 1.8 per cent expected previously.

As for the labour market, respondents expect the unemployment rate to tick up to 2.2 per cent by the year-end, from 2.1 per cent in the previous survey. - THE STRAITS TIMES

BUSINESS & FINANCE