Singapore: GDP rebounds in quarter-on-quarter terms in Q3
October 17, 2022
The economy expanded 1.5% in seasonally adjusted quarter-on-quarter terms in Q3, bouncing back from the 0.2% contraction recorded in the prior quarter and beating market expectations. Meanwhile, the economy expanded 4.4% year on year in the third quarter, decelerating from Q2’s 4.5% growth.
This rebound in qoq growth was led by turnarounds in the construction and services sectors. Output in the services sector expanded 2.5% in Q3 (Q2: -0.2% qoq), with activity benefitting from the further loosening of Covid-19 restrictions at home and abroad. This was reflected in the gains recorded in the retail trade and transportation sectors. Meanwhile, growth in the construction sector sped up to 3.9% in Q3 from 1.5% in the prior quarter, underpinned by the easing of border restrictions on the inflow of migrant workers. On the flip side, production in the manufacturing sector contracted 3.3% in Q3, swinging from a 0.4% increase in Q2, seemingly due to the impact of high production costs amid a challenging geopolitical backdrop.
Commenting on the outlook, analysts at UOB stated:
“With the external environment under significant challenges due to the Russia-Ukraine conflict, ongoing policy tightening by major central banks and risks of recession in advanced economies, domestic services sector will play an increasingly important role in the quarters ahead.”