George Russell in Hong Kong
Singapore’s financial system continued to contract within the fourth quarter, based on knowledge launched on Monday, however at a slower tempo than the earlier quarter, as manufacturing, wholesale commerce and finance grew as the consequences of the coronavirus pandemic on the city-state pale.
The south-east Asian nation’s gross home product declined by 2.4 per cent within the fourth quarter from a yr earlier, based on revised knowledge launched by the Ministry of Commerce and Business.
The contraction was an enchancment from the 5.8 per cent shrinkage within the previous quarter, the ministry mentioned.
On a quarter-on-quarter seasonally adjusted foundation, the financial system expanded by 3.8 per cent, following the 9 per cent progress recorded within the earlier quarter, official knowledge confirmed.
The ministry mentioned it could preserve its GDP progress forecast for 2021 at 4-6 per cent.
“We increase our 2021 GDP progress forecast to five.5 per cent,” mentioned Brian Tan, Barclays analyst in Singapore.
Hawker’s apprentice Lim Wei Keat shows chickens at a meals stall in Singapore
Manufacturing grew by 10.3 per cent year-on-year, extending the 11 per cent enlargement within the third quarter.
“Development was supported by output expansions within the electronics, biomedical manufacturing, precision engineering and chemical substances clusters, which greater than offset output declines within the transport engineering and basic manufacturing clusters,” the ministry mentioned.
The development sector contracted by 27.4 per cent year-on-year attributable to declines in
each public sector and personal sector development works, an enchancment from the 52.5 per cent contraction within the third quarter.
The wholesale commerce sector grew by 1.8 per cent year-on-year, a turnaround from
the 5 per cent contraction within the third quarter, the ministry added.
“The financial system is on a restoration path after the robust rebound in Q3 and the trough registered in Q2,” mentioned Irvin Seah, economist at DBS. “Nevertheless, the tempo of progress has slowed, as this V-shaped restoration turns right into a sq. root formed trajectory.”
Seah mentioned Singapore had entered a normalisation course of. “As financial actions progressively resume to norm, progress momentum will naturally revert to a extra sustainable tempo.”