Singapore's economic growth eased in the second quarter and missed forecasts, preliminary data showed on Friday, as manufacturing activity cooled and worsening US-China trade tensions clouded the outlook for the trade-reliant city-state.
Gross domestic product grew 1.0 percent in the second quarter from the previous three months on an annualised and seasonally adjusted basis, the Ministry of Trade and Industry said on Friday, slower than the median forecast of 1.2 percent in a Reuters poll of economists and the downwardly revised 1.5 percent growth in the first quarter.
"Overall, the sense is that momentum is going to continue to slow, some of it from the high base last year, some of it because electronics seems to be tapering off a little bit," said Selena Ling, OCBC Bank's head of treasury research and strategy.
The economy expanded 3.8 percent in April-June from a year earlier, versus the median forecast of a 4.0 percent expansion in the poll, and decelerating from the downwardly revised 4.3 percent growth posted for January-March.
Manufacturing and exports of electronics were one of Singapore's main drivers of growth last year. However, a decline in electronics shipments for six consecutive months has raised questions about overall demand in the sector.
Still, OCBC's Ling said the drivers of manufacturing had broadened slightly, thanks to contribution from the biomedical sector, which was positive.
Earlier this month, the Monetary Authority of Singapore warned risks to the global growth outlook have increased significantly thanks to the intensifying trade row and the rising prospect of a rapid acceleration in inflation.
Singapore is seen as a bellwether for global growth because international trade dwarfs its domestic economy, equating to about 200 percent of its GDP.
In May, the MTI had forecast full-year economic growth of 2.5 to 3.5 percent. GDP grew 3.6 percent rise in 2017, the fastest pace in three years.
"Going forward, downside risks to the economy will involve supply chain risks from US-China trade tariffs," said Jeff Ng, chief economist, Asia, at Continuum Economics.
"Meanwhile, property cooling measures may also limit the upside to Singapore's near-term domestic growth," he added.
The city-state last week toughened curbs on the housing market, in a surprise move.
In April, the central bank tightened monetary policy for the first time in six years. Analysts are split over whether the move is the start of a longer-term tightening cycle.
Unrestrained power in your hands
For almost 20 years, Malaysiakini has stayed true to the cause of providing the Malaysian public with the truth. We believe that with unadulterated information, the people will obtain power to make informed decisions.
Decisions which lead to a healthy, robust nation - ours!
Keep the truth alive. Support your robust, independent media. You have the unrestrained power to do so.
Who says it's not our fault?
We aren’t trained to take responsibility.
Everytime we observe an injustice - and choose to keep mum - the prevalence of injustice becomes our fault.
Astute journalism paves the way for the public to be continuously furnished with the fastidious truth. You are continuously empowered to act and to uphold the integrity of the nation.
The Rakyat owns Malaysiakini
We choose to take a risk on independent media because we believe that only through independent reporting can one be NOT beholden to the interest of businesses or organisations. This allows us to really pursue the truth - aggressively.
Independent for 20 years.
The victorious people
In the light of holding the truth to power, Malaysiakini will continue to uphold its mission of providing credible news to its discerning public. Your support for Malaysiakini is always treasured as a testament of innate nationalism. Your victory is our history.
Quietly. Effectively. Says it all. Malaysiakini.
Speaking truth to power
When we embarked on this journey 20 years ago, we knew we would face intimidation, harassment, raids, arrests and perhaps even jail terms. We got into this venture with our eyes wide open.
The main reason we have survived this long - when many others have folded - is partly because we are prudent in our finances. But while we may be tightfisted in our budgeting, we do not hold back when it comes to speaking truth to power and holding power to account. And certainly, this new administration will not stop us from continuing to do so.