Economy

Economy: Stronger than expected 3Q GDP growth
Singapore economy expanded stronger than expected by 1.9% in 3Q15 (2Q15: 2%), compared to street expectations for a 1.4% growth.

However, MTI has yet again lowered its 2015 growth projection to close to 2%, compared to the earlier 2-2.5% forecast in the semi-annual macroeconomic review last month.

For the quarter, the outperformance was thanks to significant expansion from the services sector, which grew 3.6% due to expansion in the wholesale & retail trade sector.

However, manufacturing remained a drag as it shrank further by 6.2% y/y, extending the 4.8% contraction in 2Q15, from a fall in output of electronics, precision engineering clusters and transport engineering.

In 2016, MTI expects improved economic growth of 1-3% on the back of expansion in advanced economies and improvements in most emerging market and developing economies.

However, it also flagged downside risks to global growth outlook, citing the possibility of a significant drop in demand in China should ongoing reforms falter.