Singapore: Revised estimates confirm economic growth decelerated in Q4
February 15, 2018
Restrained by a contraction in the manufacturing sector, economic growth decelerated in the fourth quarter, according to revised estimates released by the Ministry of Trade and Industry on 14 February. GDP grew 2.8% quarter-on-quarter in Q4 at a seasonally-adjusted annualized rate (SAAR), confirming the preliminary estimate. It was down sharply from Q3’s 11.2% jump.
The slowdown was led by a downturn in the volatile manufacturing sector. Manufacturing plunged 14.8% qoq SAAR, although the reading suffered from a strong base, as the manufacturing sector surged 34.9% in Q3. On the other hand, the services sector, which accounts for about two-thirds of the economy, expanded a strong 6.3% qoq SAAR in the fourth quarter of the year, nearly matching the previous quarter’s 6.5% growth. Lastly, the contraction in the construction sector eased further, from -2.4% in Q3 to -0.2% in Q4.
In year-on-year terms, GDP expanded a revised 3.6% in Q4 (previously reported: +3.1% year-on-year), losing steam from Q3 (+5.5% yoy). This brought growth for 2017 to 3.6%, well above the 2.4% expansion recorded in 2016. In Q4, annual growth came on the back of a 4.8% expansion in the manufacturing sector (Q3: +19.1% yoy), led by growth in the electronics and precision engineering clusters, which offset contractions in the biomedical manufacturing and transport engineering clusters. Growth in the service sector remained solid, matching the previous quarter’s 3.5% increase. On the downside, the construction sector shrank for a fourth consecutive quarter in Q4; the contraction was, however, softer than in the previous quarter.
Singapore GDP Forecast
FocusEconomics Consensus Forecast panelists project that the economy will expand 2.8% in 2018, which is unchanged from last month’s forecast. For 2019, the panel expects growth will decelerate marginally, to 2.6%.