Singapore Economy Skirts Recession In Q2

(RTTNews) - The Singapore economy avoided a recession in the second quarter underpinned by services activity, the advance estimates from the Ministry of Trade and Industry showed on Friday.

Gross domestic product posted a quarterly growth of 0.3 percent, in contrast to the 0.4 percent decrease in the first quarter. The rate came in line with expectations.

Year-on-year, the economy grew 0.7 percent after expanding 0.4 percent in the preceding period. This was also better than economists' forecast of 0.6 percent.

The acceleration in services output growth to 1.3 percent in the second quarter from 0.4 percent in the preceding period was the major reason for the economic rebound.

Likewise, construction output moved up 2.6 percent after a 0.3 percent gain. On the other hand, manufacturing output contracted 1.3 percent.

Capital Economics' Shivaan Tandon said Singapore's economic growth is set to remain subdued.

The economist said weak global demand, elevated interest rates and tepid wage growth are set to suppress activity in both external and domestic facing sectors of the economy.

Tandon forecast the economy to grow just 0.5 percent this year.