Private sector economists have further upgraded their outlook on the Singapore economy, and now expect GDP to contract by 2 per cent this year.
In the previous survey of professional forecasters conducted by the Monetary Authority of Singapore (MAS) in September, economists had a median forecast of a 3.6 per cent decline in GDP for the whole of 2009.
For the fourth quarter, the 20 economists who responded to the latest survey expect most sectors to continue posting improved numbers.
They expect financial services to return to positive growth of about 9.9 per cent in the last three months of the year, after declining 0.2 per cent in the previous quarter.
They also projected positive numbers for non-oil domestic exports, giving a median forecast of 3 per cent growth, following last quarter’s 7.8 per cent decline in exports.
Manufacturing is expected to grow at a median rate of 8 per cent, after posting a surprise 6.6 per cent growth in the third quarter.
However, director of Asian economic forecasting at Action Economics, David Cohen, cautioned on Wednesday that manufacturing could also surprise on the downside.
“I guess the uncertainty surrounds the manufacturing sector, where we saw a strong bounce in the prior quarters after the weakness at the beginning of the year,” he said.
“But perhaps it was exaggerated by the pharmaceuticals sector, which can be volatile month-to-month, and it could be pulling back in the fourth quarter.”
The 20 economists who responded to the latest survey have also upgraded their forecast for fourth quarter growth.
They now have a median forecast of a 4.7 per cent expansion in the fourth quarter, up from 1.9 per cent in the previous survey. For 2010, the analysts have projected the economy to grow by 5.5 per cent.
Source : Channel NewsAsia – 9 Dec 2009
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