FX.co ★ Singapore Q1 GDP Growth Below Estimates

Singapore's economy witnessed a growth of 3.8% year-on-year in the first quarter of 2024, a deceleration from the 5.0% expansion recorded in the third quarter and below the market's expectation of a 4.2% rise, according to preliminary data. This represents the slowest growth pace since the second quarter of 2024, amidst increasing external challenges. The manufacturing sector's growth moderated (5.0% compared to 7.4% in Q3), with progress noted across all clusters except in chemicals and general manufacturing. There was also a slowdown in services activities (3.4% versus 4.6%), attributed to reduced growth in wholesale and retail trade, communication, and the finance & insurance sectors, though the accommodation sector showed stability. Meanwhile, construction output experienced a slightly faster increase (4.6% compared to 4.4%), propelled by heightened activity in both public and private sector projects. On a quarterly basis, the nation's GDP contracted by 0.8%, reversing the 0.5% growth seen in Q3, marking the first contraction in two years. Looking ahead to 2025, the government anticipates the economy will grow within a range of 0% to 2%, revised down from an earlier projection of 1% to 3%. In the previous year, GDP grew by 4%, significantly higher than the 1.1% increase observed in 2023.