Singapore: Clouds on the horizon – Standard Chartered

Singapore’s Q2 final GDP growth was revised higher to 3.9% y/y from the advance print of 3.8%, easing from the revised 4.5% y/y in Q1 (from 4.3% due to the upward revision from manufacturing), notes the research team at Standard Chartered.

Key Quotes

“Q2 manufacturing GDP growth was revised higher to 10.2% y/y from 8.6%, in line with our expectation, as June industrial production (IP) came in higher than implied by the advance print.”

“Q2 construction GDP fell 4.6%, relatively unchanged from the advance print of -4.4%; this was the slowest pace of decline in six quarters. Meanwhile, Q2 services GDP growth was revised significantly lower to 2.8% y/y from the advance print of 3.4%, the slowest pace of growth in four quarters.”

“Actual data has remained sanguine so far; however, sentiment is not. The ongoing US-China trade dispute poses the biggest downside risk to growth, in our view.”

“Weak financial market sentiment amid emerging-market weakness is also a risk worth monitoring. With risk biased to the downside, we see increasing risk of the central bank staying status quo in October (our current call is for a slight tightening).”