The global economic slowdown, social distancing measures and travel lockdowns could send Singapore sinking into a recession this year, said OCBC Bank, the latest bank to downgrade its economic growth forecast.

It said yesterday that it expects the economy to shrink by 0.5 per cent this year. This is compared with its previous forecast of 0.3 per cent growth.

Ms Selena Ling, its head of treasury research and strategy, noted that first-quarter growth could contract by 1.1 per cent compared with the same period last year and plunge 8.7 per cent compared with the previous quarter.

This would be the worst year-on-year showing since June 2009 and the worst quarter-on-quarter sequential growth since September 2015, she said, adding that these forecasts are due to outbreak disruptions "impacting the manufacturing and trade sector".

OCBC is also revising down its forecasts for headline and core consumer price index to between minus 0.5 per cent and 0.5 per cent for the year, because of potential deflationary pressures arising from the oil price slump and tanking consumer spending.

DBS Bank and Standard Chartered Bank also predicted a recession for Singapore this year. DBS senior economist Irvin Seah pointed to a 0.5 per cent contraction, warning of significant risks if the outbreak worsens.