Economy: Market watchers downgraded GDP growth estimates
Economists lowered Singapore’s GDP growth expectations for 2015 from 2.7% down to 2.2%, and expect more downgrades ahead.
This comes on the back of the weak August PMI released yesterday which slipped to 49.3 (Jul: 49.7), just a tad lower than street expectations of 49.4.
The contraction was due to lesser new orders, production output and input prices, consistent with the recent rout in global manufacturing PMI numbers, namely in China, Taiwan, South Korea, Malaysia and Indonesia.
Market watchers believes that this raises the odds for a technical recession, should other engines of growth (namely services sector) also falter amid the ongoing pullback in consumer and business sentiments attributed to China's slowdown and US rate-hike uncertainties.
Meanwhile, the Ministry of Trade and Industry is still maintaining its broad 2-4% growth range for 2015.
Observers would be anticipating the upcoming semi-annual monetary policy statement from MAS due in Oct, for further assessment on how the government would react to the uncertain global situation.