By BLOOMBERG
Singapore’s economy expanded more than economists estimated as services and construction provided support to counter faltering exports amid China’s economic slowdown and an uneven global recovery.
Gross domestic product rose an annualised 5.7% in the three months to Dec 31 from the previous quarter, when it expanded a revised 1.7%, the Trade Ministry said in a statement on Monday. The median of nine estimates in a Bloomberg News survey was for a 1% expansion. The economy grew 2.1% last year.
“What the number continues to suggest is that services are becoming more important for growth, and will likely be so over the course of 2016,” said Michael Wan, a Singapore-based economist at Credit Suisse Group AG. It also “perhaps reflects some stabilisation in Asean growth”, he said, referring to the Association of Southeast Asian Nations. Headwinds persist for the region, including a slowing credit cycle and weaker China, he said.
The city state has relied on its position as an Asian financial hub to bolster services as overseas demand for its goods faltered. While industrial production fell for a 10th straight month in November, retail sales rose for a ninth month in October.
GDP grew 2% in the fourth quarter from a year earlier, compared with a median survey estimate for 1.2%.
The Singapore dollar traded at 1.4181 against the US currency as of 8:14am after the GDP report, compared with 1.4185 on Dec 31. Singapore markets were closed for New Year’s Day on Jan 1.
Services support
Singapore’s manufacturing fell 3.1% last quarter from the previous three months, the Trade Ministry said. The services industry grew 6.5% in the same period, while construction expanded 7%.
Monday’s data are advance estimates computed largely from figures in the first two months of the quarter and may be revised later, the ministry said.
— By Sharon Chen
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