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).”