Economy not doing so well, so will there be early elections
http://www.cnbc.com/id/34681745
Singapore GDP Shrinks By Wider Than Expected Margin
Published: Sunday, 3 Jan 2010 | 8:26 PM ET
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By: Reuters
Singapore's economy shrank a bigger-than-expected 6.8 percent on a seasonally adjusted and
annualized basis in the fourth quarter, raising expectations the central bank may not start tightening policy until later in the year.
Economists have been expecting the central bank to shift towards tighter policy at its next meeting in April by allowing a gradual appreciation of the Singapore dollar, but a shaky
recovery from recession could mean policy will be on hold.
"The numbers are still patchy, which is a reminder to policymakers that it is not going to be plain sailing... Monetary policy may still have to be maintained until we see signs of a stronger pickup," said Song Seng Wun, economist at CIMB in Singapore.
Analysts in a Reuters poll had predicted gross domestic product to fall 0.8 percent in the December quarter after rising 14.9 percent in the previous quarter.
The Singapore dollar, the central bank's main policy tool, traded at 1.4042/56 per U.S. dollar, slightly weaker compared to levels of 1.4020/50 just before the economic data was released.
GDP in the October-December period grew 3.5 percent from a year earlier, the second quarterly growth after three quarters of annual contraction. Growth was smaller than expected as
manufacturing weakened, the advance data showed.
On a seasonally adjusted and annualised basis, manufacturing shrank 38.4 percent from the previous quarter, while construction grew 4.3 percent and service industries expanded 7.2 percent.
"What is very encouraging in the fourth quarter data is the sharp turnaround in services. This basically bodes well for our outlook for Singapore this year," said Selena Ling, head of treasury research at OCBC in Singapore.
GDP fell 2.1 percent in 2009, largely in line with economists' forecasts. The government expects growth for this year of 3 to 5 percent.
http://www.cnbc.com/id/34681745
Singapore GDP Shrinks By Wider Than Expected Margin
Published: Sunday, 3 Jan 2010 | 8:26 PM ET
Text Size
By: Reuters
Singapore's economy shrank a bigger-than-expected 6.8 percent on a seasonally adjusted and
annualized basis in the fourth quarter, raising expectations the central bank may not start tightening policy until later in the year.
Economists have been expecting the central bank to shift towards tighter policy at its next meeting in April by allowing a gradual appreciation of the Singapore dollar, but a shaky
recovery from recession could mean policy will be on hold.
"The numbers are still patchy, which is a reminder to policymakers that it is not going to be plain sailing... Monetary policy may still have to be maintained until we see signs of a stronger pickup," said Song Seng Wun, economist at CIMB in Singapore.
Analysts in a Reuters poll had predicted gross domestic product to fall 0.8 percent in the December quarter after rising 14.9 percent in the previous quarter.
The Singapore dollar, the central bank's main policy tool, traded at 1.4042/56 per U.S. dollar, slightly weaker compared to levels of 1.4020/50 just before the economic data was released.
GDP in the October-December period grew 3.5 percent from a year earlier, the second quarterly growth after three quarters of annual contraction. Growth was smaller than expected as
manufacturing weakened, the advance data showed.
On a seasonally adjusted and annualised basis, manufacturing shrank 38.4 percent from the previous quarter, while construction grew 4.3 percent and service industries expanded 7.2 percent.
"What is very encouraging in the fourth quarter data is the sharp turnaround in services. This basically bodes well for our outlook for Singapore this year," said Selena Ling, head of treasury research at OCBC in Singapore.
GDP fell 2.1 percent in 2009, largely in line with economists' forecasts. The government expects growth for this year of 3 to 5 percent.