The better-than-expected results and an upward revision to first-quarter data of three.0% prompted economists to boost their gross domestic product (GDP) forecasts for this 12 months. Singapore’s trade-dependent economy is commonly a proxy for Asia’s economic health, belying its size.
Economists polled by Reuters had forecast annual GDP growth within the April-June period at 2.7 percent.
Maybank’s Chua Hak Bin revised his forecast from 2.4% to around 2.8%-3% for the total 12 months. OCBC chief economist Selena Ling revised hers from 2.3% to over 2.5%.
“The recovery in the manufacturing sector is picking up slightly earlier than expected, starting in the second quarter rather than the second half of 2024,” Ling said.
According to data from the Ministry of Trade and Industry, on a quarterly basis, after bearing in mind seasonal aspects, GDP within the second quarter increased by 0.4%.
The manufacturing sector grew by 0.5% within the second quarter, reversing the trend from the previous quarter, which saw a decline of 1.7%.
The preliminary second-quarter GDP data got here after the Asian financial hub reported its fastest growth in 18 months in the primary quarter.
In May, the Commerce Ministry maintained its economic growth forecast for 2024 at between 1.0% and three.0%.
Singapore’s GDP grew by 1.1% last 12 months, slowing from 3.8% in 2022.
Although annual core inflation fell from a peak of 5.5% in early 2023 to three.1% in recent months, it stays elevated and hit a seven-month high in February.
The Monetary Authority of Singapore, the city-state’s central bank, uses the exchange rate as its foremost tool for interest-rate policy. It plans to review its policy settings later this month.
The central bank left monetary policy unchanged for 4 consecutive meetings until April.
