Quick takes: Analysts on Singapore GDP data

An office worker in the Central Business District of Singapore.
An office worker in the Central Business District of Singapore.PHOTO: ST FILE

SINGAPORE - The economy expanded at a modest pace in the first quarter, growing 1.8 per cent from a year ago, unchanged from an advance estimate and from growth in the previous quarter, fresh data from the Ministry of Trade and Industry (MTI) showed on Wednesday (May 25).

On an annualised basis, Singapore's economy grew 0.2 per cent in the first quarter over the previous three months, better than the zero per cent growth initially estimated.

Here are some quick views from analysts.


OCBC economist Selena Ling: Figures disappointed

"Singapore's first quarter growth figures disappointed market and our expectations for a higher revision.

Services momentum cooled faster than estimated in the first quarter. Worryingly, the services sector actually decelerated more than earlier estimated at 1.4 per cent growth from a year ago (from a flash estimate of 1.9 per cent growth), with transport and storage activities contracting for the second straight quarter by 0.4 per cent from a year ago.

Meanwhile, trade agency International Enterprise Singapore downgraded its full-year non-oil domestic exports (NODX) growth forecast to shrink 3 to 5 per cent year-on-year (previously forecast at 0 to 2 per cent growth), and total trade to contract 6 to 8 per cent this year as low crude oil prices dampen oil trade in nominal terms."

Mizuho economist Vishnu Varathan: Drag on growth to continue

"As expected, growth momentum was higher than initial estimates... The main reason for the upward revision (to annualised quarter-on-quarter growth) is that headwinds in the manufacturing sector were less acute than expected.

That said, this is likely to prove temporary. Meanwhile, sluggish external demand will continue to be a drag on growth as well."