Singapore’s economy rises a 0.2% in the 1Q of 2021

Singapore’s economy rises a 0.2% in the Q1 of 2021

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Singapore’s economy grew by 0.2 percent year-on-year in the first quarter of 2021.

A turnaround after three quarters of contraction, as the country continued its recovery from the COVID-19 pandemic.

On a quarter-on-quarter seasonally adjusted basis, Singapore’s gross domestic product (GDP) expanded by 2 percent between January and March, extending the 3.8 percent growth in the previous quarter, advance estimates by the Ministry of Trade and Industry (MTI) on Wednesday (Apr 14) showed.

Economists polled by Reuters had expected a decline of 0.2 percent.

Singapore’s economy has been battered by the COVID-19 pandemic. After the first case was reported in Singapore on Jan 23 last year, Singapore posted 0 percent growth in GDP in the first quarter, followed by contractions in the following three quarters.

Last year, Singapore’s economy shrunk by 5.4 percent, the country’s first annual contraction since 2001 and its worst recession since independence.

“The expansion is a strong signal that our economy is slowly but surely recovering from the unprecedented impact of COVID-19 last year,” said Minister for Trade and Industry Chan Chun Sing in a Facebook post after the data was released.

“While we are cautiously optimistic, many downside risks remain which we will have to pay close attention to,” he added.

Factory activity also helped Singapore’s economy

Singapore’s economy rose on the back of strong manufacturing activity.

The sector grew 7.5 percent year-on-year, supported by output expansions in the electronics, precision engineering, chemicals and biomedical manufacturing clusters.

Construction sector continued to contract, albeit at a slower rate, as activity in the private and public sectors picked up.

The sector shrank by 20.2 percent in the first quarter, compared with the 27.4 percent decline in the fourth quarter of 2020.

Among the services sectors, the wholesale and retail trade as well as transportation and storage trade sectors shrank by 4.1 percent in the first quarter. 

Source: Channel News Asia

Core inflation fell in October in Singapore

Core inflation fell in Singapore in October

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Consumer prices in Singapore deepened their decline in October as core inflation fell, even as authorities forecast a “mildly positive” turn in 2021.

Core inflation fell to -0.2 percent year-on-year in October, compared with -0.1 percent in September, data from the Monetary Authority of Singapore (MAS) and Ministry of Trade and Industry (MTI) showed on Monday.

MAS’s core inflation measure excludes accommodation and private transport.

Overall consumer price index (CPI)-all items inflation, which includes both components, fell to -0.2 percent year-on-year last month, compared with 0 percent in September.

The inflation figures came as the trade and industry ministry said Singapore’s economy was expected to shrink between 6 percent and 6.5 percent this year, after a smaller-than-expected 5.8 percent contraction in the third quarter.

The fall in core inflation was mainly driven by steeper declines in the costs of services and retail and other goods, as well as lower food inflation, MAS and MTI said in a joint news release.

core inflation breakdown

Services costs fell by -0.5 percent on account of lower telecommunication services inflation and a larger decline in tuition and other fees.

Retail and other goods declined -1.6 percent after telecommunication equipment costs and prices of recreational goods dropped. Prices of household supplies also rose at a more gradual pace, said MAS and MTI.

Food inflation edged down to 1.7 percent in October, as prices of non-cooked food grew at a more moderate pace.

Private transport costs saw a larger drop of -1.3 percent in October, compared to -0.1 percent in September. This was attributed to car prices rising at a more gradual pace, and fuel costs declining more sharply

MAS and MTI retained their outlook from September on external inflation remaining low, amid weak demand in key commodity markets and “the persistence of negative output gaps” in Singapore’s major trading partners.

Cost pressures are expected to stay subdued on the domestic front, with “accumulated slack” in the labor market weighing on wages.

“Nevertheless, core inflation is forecast to turn mildly positive in 2021, as the disinflationary effects of government subsidies introduced this year fade and demand for some domestic services gradually pick up,” said MAS and MTI.

Accommodation costs are expected to continue falling due in part to a decline in foreign employment, while private transport costs should rise modestly ahead of an anticipated reduction in Certificate of Entitlement supply next year.

The agencies’ projections of core inflation and overall inflation remained unchanged from last month, at between -0.5 and 0 percent in 2020.

Source: Channel Asia

singapore retail sales fell

Retail sales in Singapore fell 8.5 percent in July

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Retail sales were on the rocky road to recovery in July, the first full month with shops reopened, after the second-quarter’s “circuit-breaker” shutdown.

This is an improvement from the 27.7 per cent plunge in June, said the Department of Statistics (SingStat) on Friday

Excluding motor vehicles, retail sales fell 7.7 per cent year-on-year, figures released by SingStat showed.

Compared to June, seasonally adjusted retail sales saw a 27.4 per cent increase month-on-month in July – this was attributed to a lower base in the previous month, when most physical stores were closed until Jun 18, before Phase 2 of Singapore’s reopening began.

The estimated total retail sales value in July was about S$3.3 billion, with online retail sales making up an estimated 11.0 per cent.

Retail sales in the F&B Sector

Sales of F&B services fell 25.4 per cent year-on-year, compared to the 43.6 per cent decline in the previous month, said SingStat.

On a seasonally adjusted basis, sales of F&B services grew 29.2 per cent in July over the previous month.

The growth was mainly attributed to the lower base in June, when food & beverage establishments operated on a takeaway or delivery basis until Jun 18.

The turnover of restaurants and food caterers declined 29.9 per cent and 45.2 per cent respectively in July this year compared to July 2019.

“Similarly, cafes, food courts and other eating places and fast food outlets recorded lower sales of 19.6 per cent and 11.5 per cent respectively during this period,” SingStat added.

On a seasonally adjusted basis, turnover of restaurants, cafes, food courts and other eating places as well as fast food outlets grew by between 7.2 per cent and 61.0 per cent compared to the previous month, with more people dining in at food and beverage establishments in Phase 2.

We can say that these sectors are still affected by low tourism in the city-state.

Singapore suffers economic downturn due to pandemic

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Preliminary data revealed by the Ministry of Trade and Industry show the impact of the pandemic, the agency reported a downturn in the economy during the Q2 of the year.

Singapore suffered a big economic downturn in the Q2 of the year that led to a recession, this as consequence of the crisis for Covid-19 pandemic.

According to preliminary data from the Ministry of Trade and Industry, the Gross Domestic Product (GDP) drop by 41.2%, far above the 37.4% forecast by economists.

“We were expecting these numbers to look quite dismal, although this is worse than what we had expected” said Steve Cochrane, economist at Moody’s Analytics.

The Singaporean government agency also said that, compared to the previous year, the economy shrank 12.6% between April and June.

Singapore is the first Asian economy to report the GDP data for this Q2, the numbers show the impact of Covid-19 on the city-state.

The services and construction sector are the most affected by this economic downturn, the construction sector was practically paralyzed with a 95% drop in this last quarter.

The Singapore government forecasts that the GDP will shrink between 4 and 7% in annual terms, which would be considered the worst decline in its history.

The Ministry of Trade attributed the contraction to “low external demand in the context of a downturn in the global economy.”

Many countries around the world are already facing their worst downturn in the economy in decades.

Covid-19 outbreak in Singapore

The government reported 249 new cases of coronavirus on Wednesday, bringing the total number to 46,878 infected and 27 deaths.

Globally, the virus outbreak has infected more than 13.4 million people. More than 580,000 people have died.