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The Government has narrowed its economic growth forecast range for 2022 in tandem with a worsening outlook for the global economy and stubbornly high inflation.
The Ministry of Trade and Industry (MTI) narrowed its range for Singapore's gross domestic product growth this year to 3-4 per cent, from an earlier projection of 3-5 per cent. The cut takes into account Singapore's economic performance in the first-half of the year and the latest global and domestic economic developments.
The economy grew by 4.4 per cent year on year in Q2, taking the first-half growth to 4.1 per cent, the ministry said in its second-quarter Economic Survey of Singapore for 2022.
The pace of growth was less than the 4.8 per cent MTI projected in July, though faster than the 3.8 per cent achieved in Q1.
On a quarter-on-quarter seasonally adjusted basis, the economy contracted slightly by 0.2 per cent, a reversal from the 0.8 per cent expansion in Q1 and a worse outcome when compared with MTI's earlier estimate of 0 per cent.
Permanent Secretary for Trade and Industry Gabriel Lim said the global economic environment has deteriorated further since the last projections were made.
"Stronger-than-expected inflationary pressures and the more aggressive tightening of monetary policy in response are expected to weigh on growth in major advanced economies," he said on Thursday.
"Against this backdrop, the growth outlook for some outward-oriented sectors in the Singapore economy has weakened."
The survey showed the manufacturing sector expanded by 5.7 per cent year on year in Q2, extending the 5.5 per cent growth in the previous quarter.
Growth in the construction sector picked up to 3.3 per cent year on year, from the 2.4 per cent registered in the previous quarter.
Meanwhile, the wholesale trade sector grew by 1.9 per cent year on year, slower than the 4.8 per cent growth achieved in Q1.
The Straits Times
