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Economists predict Singapore's GDP growth to be 6.5% for yr 2010

The MAS - Monetary Authority of Singapore's survey of 20 private-sector economists have upped their forecast for Singapore's growth for year 2010 to be 6.5 per cent, higher than the previous forecast of 5.5 per cent made in December.

The MAS - Monetary Authority of Singapore's survey of 20 private-sector economists have upped their forecast for Singapore's growth for year 2010 to be 6.5 per cent, higher than the previous forecast of 5.5 per cent made in December. In February, the Singapore Government has also upgraded its year 2010 economic growth outlook to 4.5-6.5 per cent, from the previous forecast of 3.0-5.0 per cent.

Performance expectations for Singapore's major industries has also increaesed. Leading the way is Singapore's manufacturing sector, which is now expected to grow an annual 9.7 per cent this year - higher than the previous forecast of 6.3 per cent. Mr Song Seng Wun, regional economist at CIMB-GK Research, reported that the manufacturing sector, led by pharmaceuticals sector and strong contributions from the Tech sector had a very strong start to year 2010, For the month of January 2010, factories produced 39.4 per cent more than it did in the same month last year, the biggest jump in output registered in 26 years. Other industries - Wholesale and retail trade is seen to grow 8.4 per cent instead of previous forecast of 7.0 per cent, and Construction sector's new forecast is to grow 8.9 per cent, from a previous projection of 7.1 per cent.

Analysts say that Singapore's Economy is likely to grow 9.5 percent in the Q1 2010 from a year earlier and 6.3 percent in Q2 2010. David Cohen, director of Asian economic forecasting at Action Economics, said: "Those numbers can fluctuate quarter on quarter, and as far as the financial services, the outlook is still bright in the long term. The fact that the stock market has bounced back nicely from a year ago should help support investment activity." Singapore's economy contracted 2.0 per cent last year due to the global economic downturn. But it has managed to pull itself out of recession and rebounded strongly. Improving global trade and continued consumption by major Asian markets like China also helped spur the rapid recovery in the beginning of this year.

It is also forecasted that inflation rate will probably rise to 2.7 percent this year, while unemployment rate is expected to be 2.0 percent. Analysts also expect exchange rate to average at 1.35 Singapore dollars per U.S. dollar. As for 2011, experts estimate that Singapore's GDP growth will be at 5.5 percent. The conservative expectations are a result of inventory restocking cycle being over, and concerns on over this year's pace of recovery.