Singapore GDP Growth Picks Up In Q4

(RTTNews) - Singapore's economy expanded at a faster pace in the fourth quarter on the back of growth in manufacturing and construction output but a less favorable external environment poses risks to the outlook.

Gross domestic product grew 2.8 percent annually, following the 1.0 percent expansion in the preceding period, advance estimates from the Ministry of Trade and Industry showed on Tuesday.

On a quarter-on-quarter basis, the economic growth improved to 1.7 percent from 1.3 percent in the third quarter.

For the whole of 2023, the city-state economy grew 1.2 percent, moderating from the 3.6 percent growth in 2022.

Prime Minister Lee Hsien Loong said on Sunday that the economy is set to grow 1-3 percent in 2024 but the outcome will depend much on the external environment.

He cautioned that geopolitical uncertainties will weigh on the global economy.

In the fourth quarter, manufacturing output rebounded 3.2 percent after a 4.7 percent fall. All clusters except the precision engineering expanded in December. At the same time, underpinned by both public and private sector, annual growth in construction accelerated to 9.1 percent from 6.2 percent. Services producing industries' growth climbed 2.4 percent following a 2.3 percent rise.

Capital Economics' economist Shivaan Tandon said despite the improvement in the fourth quarter, the economy is set to enter a period of renewed weakness in the near term as support from external demand fades while domestic demand remains weak.

The economist expects the Monetary Authority of Singapore to keep its policy unchanged at the next meeting on January 29.

The weaker economic data in the first quarter and further drops in inflation are likely to prompt the central bank to ease its policy in April, Tandon added.