Singapore downgrades 2019 GDP forecast as Q1 growth hits decade low

Credit: REUTERS/FELINE LIM

Singapore's annual economic growth slipped to the lowest in nearly a decade in the first quarter led by a slump in manufacturing, final data showed on Tuesday, prompting a downgrade to the city-state's full-year growth forecast.

By Fathin Ungku

SINGAPORE, May 21 (Reuters) - Singapore's annual economic growth slipped to the lowest in nearly a decade in the first quarter led by a slump in manufacturing, final data showed on Tuesday, prompting a downgrade to the city-state's full-year growth forecast.

Gross domestic product (GDP) expanded 1.2 year-on-year in the three months ended March 31, down slightly from the 1.3% seen in the government's advance estimate and the fourth quarter's revised 1.3% pace.

The result, which was below the 1.5% growth forecast in a Reuters poll, marked the slowest annual expansion for any quarter since April-June 2009, when GDP shrank 1.7% from a year earlier, government data shows.

On a seasonally adjusted and annualised quarter-on-quarter basis, growth in the January-March period was at 3.8%, higher than the advanced estimate of 2.0% and the poll forecast of 2.3%.

As broad economic momentum cooled, policymakers downgraded their 2019 growth forecast to 1.5%-2.5%, from 1.5%-3.5% previously.

Gabriel Lim, permanent secretary for Trade and Industry, told a news briefing that slowing China growth and a trade dispute between Washington and Beijing were expected to weigh on Singapore's output, while slack global demand for electronics was already hitting its manufacturing sector.

"Against this challenging external economic backdrop, key outward-oriented sectors in the Singapore economy are expected to slow this year," Lim said.

(Reporting by Fathin Ungku and John Geddie Editing by Shri Navaratnam)

((fathin.ungku@thomsonreuters.com;))

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