Singapore economy grew better-than-estimated 2.6% in Q1, 2015 growth forecast stays at 2-4%

Tourists walking along the path on the waterfront promenade, along Marina Bay Sands as the skyline of Singapore Central Business District (CBD) stands in the background. The Singapore economy grew a moderate 2.6 per cent in the first three months of
Tourists walking along the path on the waterfront promenade, along Marina Bay Sands as the skyline of Singapore Central Business District (CBD) stands in the background. The Singapore economy grew a moderate 2.6 per cent in the first three months of 2015 over the same period a year ago. -- ST PHOTO: NEO XIAOBIN

SINGAPORE - The Singapore economy grew a moderate 2.6 per cent in the first three months of 2015 over the same period a year ago, faster than the 2.1 per cent expansion seen in the previous quarter, the Ministry of Trade and Industry (MTI) said on Tuesday.

This was more than the 2.1 per cent advance estimate released in April, and higher than the 2.2 per cent figure expected by economists in a Reuters poll.

The manufacturing sector was the main drag, contracting 2.7 per cent in January to March over the same period last year, due largely to declines in electronics, transport engineering and biomedical output.

In contrast, the finance and insurance sector recorded the fastest rate of growth, expanding 7.9 per cent in the first quarter following a 10.3 per cent growth rate in the preceding three months.

Other sectors such as wholesale and retail trade and business services also registered growth.

MTI said it is maintaining its GDP growth forecast for 2015 at 2.0 to 4.0 per cent.

The economic outlook has remained broadly unchanged since the start of the year, with global growth expected to improve marginally this year compared with 2014, the ministry added.

Stronger growth in the United States and Asean economies is expected to lift Singapore's externally-oriented industries such as wholesale trade, and finance and insurance.

However, the fall in oil prices has dampened the outlook for the marine and offshore sector, while flagging visitor arrivals will weigh on tourism-related sectors such as accommodation and food services.