SINGAPORE: Private-sector economists have revised their growth forecast for Singapore’s economy this year.
The latest quarterly survey by the Monetary Authority of Singapore (MAS) shows that they now expect to see GDP expand by 3.8%.
This was down a touch from the 3.9% growth forecast in the previous survey done three months ago.
The estimates are based on median figures found in MAS’ quarterly Survey of Professional Forecasters released on Wednesday.
However, the economists said the downward revision is largely because of an “upside surprise” in last year’s GDP numbers – which were only released after the previous survey had been conducted.
Overall GDP growth of 4.1% for last year exceeded economists’ forecast of 3.8%.
UOB economist Francis Tan said: “There was an upward revision in the GDP growth that we saw in 2013. So if you’re thinking that in 2014, the economic activity will still be similar to what we thought it would be in 2013, the higher base in 2013 would probably mean that 2014 may not grow as much.”
Economists however said they remain upbeat about the prospects for the Singapore economy this year.
For the first quarter of 2014 alone, economists expect growth of 5.3%.
Economists maintained that growth this year will be supported by an improving demand for exports from developed economies.
Jeff Ng, Standard Chartered Bank’s economist, said: “This year will be a stronger year in terms of better external demand for Singapore (exports) by the major economies, namely the US and Europe. Given that there will be stronger growth on that side, I think we should see Singapore enjoy the benefits of externally driven growth this year.”
UOB’s Francis Tan said: “Better recovery in the economic activities in these countries will also mean that in Singapore, our economic activity will pick up quite healthily as well.
“With better economic activity, certainly we are likely to see private consumption growing still quite robustly compared to last year.”
As for inflation, economists maintained their forecast for an increase of 2.8 per cent, unchanged from the December survey.
But core inflation – which excludes private road transport and accommodation costs – was revised up a touch to 2.4% from the 2.3% in the previous survey.
Standard Chartered Bank’s Jeff Ng said: “This year, inflation drivers are slightly different from those of previous years.
“This year’s inflation will likely be supported by services inflation as growth in Singapore remains pretty buoyant compared to previous years.
“Companies will find it easier to pass through costs to consumers so we see upsides in core inflation.
“But in terms of headline inflation, it will still be quite moderate compared to previous years as a result of slower growth in terms of housing inflation as well as for transport, given the high base effect.”
Amid robust growth prospects and potential cost pressures, economists expected the central bank to maintain its stance of a gradual moderate appreciation of the Sing dollar.
Economists cut Singapore"s growth forecast in MAS survey
0 comments:
Post a Comment