Singapore: Less bad ahead – Standard Chartered

Edward Lee – Chief Economist ASEAN and South Asia at Standard Chartered Bank – offered his take on Singapore’s final GDP report, which confirmed that the economic growth stood at 2.1% during the third quarter of 2019 and 0.5% on yearly basis.

Key Quotes:

“Singapore’s final Q3 GDP print was revised higher to 0.5% y/y from the advance print of 0.1% y/y due to better-than-expected manufacturing data (led by pharmaceutical production) in September. This brings 9M-2019 GDP growth to 0.6% y/y – the slowest 9M growth rate since 2009. The government also narrowed its 2019 growth forecast to 0.5-1% and forecast 2020 growth at 0.5-2.5%. This is broadly aligned with our expectations.”
 
“Looking ahead, we expect the downward growth momentum – which started broadly in H2-2018 – to bottom out. Signs of US-China trade war de-escalation, global monetary policy easing, fiscal support in economies such as China and India, and importantly favourable base effects in sectors such as electronics manufacturing, may push growth up in 2020.”
 
“Global trade developments are a key swing factor. The removal of previously introduced tariffs may help boost investor confidence and trade activity. But similarly, a further deterioration may affect the labour market, where private consumption is the key support to growth (with both trade and investment faring poorly).”