Singapore GDP

KK · Guru

Singapore GDP - Q406

tfwee · Veteran

RE: Singapore GDP

KK · Guru

Nov-06 Output

tfwee · Veteran

3Q06 Singapore GDP

KK · Guru

Singapore GDP

tfwee · Veteran

# Singapore's 1Q06 GDP was revised upwards from 9.1% in the Advanced Estimates to 10.6% yoy.
# The stronger growth can be attributed to robust manufacturing and services sectors growth.
# Manufacturing expanded by a stronger 20% yoy in 1Q06 as compared to +16.0% in the Advanced Estimates and +14.2% in 4Q05.
# All segments of manufacturing, especially electronics (+14% yoy), biomedical sciences (+47% yoy) and transport engineering (+35% yoy), contributed to this robust growth in 1Q06.
# Similarly, all segments of services saw stronger growth in 1Q06 as compared to 4Q05. In particular, wholesale & retail trade (+14.8%), hotels & restaurants (+7.3%) and financial services (+8.3%) as a result of continued strength in the global economy, more stable labour market conditions and higher tourist arrivals.
# Only construction was revised downwards in 1Q06 from -0.6% in the advance estimates to -1.3% yoy as the sector continues to lag behind economic growth.
# As a result of this stronger 1Q06 growth and favourable outlook for the global economy, global electronics demand and domestic conditions, the government has raised in 2006 GDP growth forecast to 5-7% from 4-6% previously.

* While the robust 1Q06 GDP growth is a boost for the economy as a whole and a tremendous start to 2006, we are cautiously optimistic.
* We remained guarded for the moment as we do not think that the strong growth momentum in 1Q06 will carry into 2H06 because:
1. The higher base of comparison in 2H05 would dampen yoy growth to a certain extent in 2H06,
2. We should not underestimate the slowdown in US growth in 2006 as a result of higher oil prices and interest rates,
3. The impact of higher oil prices that began in 2005 should begin to make itself felt not only on the Singapore economy but on the global arena as well in 2006,
4. Electronics demand may witness patches of weakness in 2H06.

* We are in the process of upgrading our GDP forecast for 2006.

KK · Guru

BT, May 17, 2006, 8.17 am (Singapore time)

S'pore raises 2006 GDP outlook after 6.8% Q1 growth

SINGAPORE - Singapore's economy grew faster than expected in the first quarter, backed by sustained demand for electronics goods and a stronger services sector, leading the government to raise its 2006 growth forecast to 5-7 per cent.

The trade-dependent economy expanded at an annualised rate of 6.8 per cent in the first quarter, the Ministry of Trade and Industry (MTI) said on Wednesday, beating the 4.3 per cent pace forecast by analysts in a poll. The pace was also five times faster than the government's advance estimate of an annualised 1.2 per cent released on April 10. The government's previous estimate for full-year growth was 4-6 per cent.

'Domestic demand has picked up, and we expect it to remain relatively strong,' Khor Hoe Ee, Assistant Managing Director at the Monetary Authority of Singapore, told a news conference. He said low unemployment and the government's 'Progress Package' - cash and social benefits for Singapore citizens included as part of this year's budget - would help boost business sentiment and lift retail sales, especially in the second half of the year.

Cheang Kok Chung, director at the MTI, said robust demand in the semiconductor sector continued to drive electronics output. -- REUTERS

KK · Guru

BT, Published March 28, 2006
Feb industrial output up a robust 37%

Economist thinks Q1 S'pore GDP on track for 8.5% growth

(SINGAPORE) Even with the expected boosts from a low base and a 'moving holiday' effect, February's industrial output still surprised on the upside, thanks to a pharmaceutical surge.

Total manufacturing output grew a stronger-than-expected 37.2 per cent year on year last month - compared with just 2.4 per cent in January - due to a few factors.

First, production in February 2005 was weak. Last month's industrial output also saw the reverse of the calendar effect that dragged down January's data: the Chinese New Year holidays, which typically mean plant closures for a week or so, came in January this year, but in February in 2005.

Then there is the volatile pharmaceutical industry, which grew 312.6 per cent in February after two months of double-digit decline.

Excluding the biomedical cluster - which expanded about 200 per cent in all last month, after taking into account the medical technology industry - manufacturing output grew almost 20 per cent in February.

While all industry clusters saw stronger growth in February than January, last month's 21 per cent electronics growth - up from 19 per cent in January - came in below expectations.

IDEAglobal, for instance, had forecast a February expansion of 25 per cent for electronics.

UOB economist Ho Woei Chen notes: 'The (February) index for electronics output was at its lowest in nine months, reinforcing our view of a shallower upturn in the electronics sector this year.'

But the industry remains 'fairly supported in the near-term', she added, citing leading indicators such as the SEMI (US-based Semiconductor Equipment and Materials International) book-to-bill ratio that returned to parity in February.

Demand for semiconductors and computer peripherals supported Singapore's electronics production last month, offsetting weak output of disk drives, infocomms and consumer electronics.

All in all, total industrial output grew an average 17.4 per cent in the first two months of the year.

This robust number suggests that Singapore's gross domestic product (GDP) is on track for 8.5 per cent growth in the first quarter, says Ms Ho of UOB.

Economists polled last month by the Monetary Authority of Singapore forecast a median 7.5 per cent GDP growth for the first quarter.

Their forecasts range from 6.2 to 10.9 per cent, and average 8.1 per cent.

Industrial output growth is expected to come from marine offshore engineering and semiconductor production, which should continue to hold up in the next two months, Ms Ho says.

But DBS economists - who had forecast a February manufacturing growth of 32.5 per cent - reckon industrial output will moderate to a single-digit growth in the first quarter, from the blistering pace of last year's second half.

With the 17 per cent January-February average, this would imply a weak industrial output number for March.

KK · Guru

BT, February 16, 2006, 8.27 am (Singapore time)

S'pore's Q4 GDP up an annualised 13%

SINGAPORE - Singapore's trade-driven economy showed higher-than-expected annualised quarter-on-quarter growth of 13 per cent in the fourth quarter, according to official data released on Thursday. It was up 8.7 per cent from the quarter a year ago.

For 2005, the GDP was up 6.4 per cent. The Government said it expects the economy to grow 4 per cent to 6 per cent in 2006, compared to an earlier forecast for 3 per cent to 5 per cent growth. The construction industry is expected to return to growth after declining 1.1 per cent in 2005.

Manufacturing was up 14 per cent. Electronics output rose more than 20 per cent for two straight months in November and December from the previous year and the momentum is expected to continue into the first half of 2006. A rise in pharmaceuticals output, which makes up close to one-fifth of manufacturing and about 10 per cent of exports, also helped drive growth in the fourth quarter.

On Jan 25, the Government revised economic growth figures for the last five years, using 2000 prices instead of 1995. -- REUTERS

To view the full report, please go to Ministry of Trade and Industry.

KK · Guru

Extracts fm OCBC Report dated 27-Jan-06,

Singapore Industrial Production

December figures in line with our forecasts. Singapore’s manufacturing output in December came in as we had expected, as the volatile biomedical sector dragged the monthly data lower. Headline figure rose just 5.1% YoY from 21.5% YoY in November, marginally above our call of 4.6%, but well below consensus forecast of 8%. This translates to a full year figure of 9.2% vs. our call of 9.3%, from 14% in 2004. The strong performance for the year reflects contributions from both electronics and non-electronics output. On a seasonally adjusted basis, manufacturing output declined 2.5% MoM vs. +0.6% MoM in November, in line with our expectation of -2.3%, but well below consensus forecast of +1.3%. While the MoM figure, which is an indication of growth momentum and surprised on the downside, we do not view this as a concern as the decline is relatively small and came after four consecutive months of declines.

Biomedical sector output a drag. Electronics sector continued to maintain its growth momentum, rising 20.7% YoY in December from 20.1% YoY in November. Semiconductor production remained the anchor, with a 31.6% YoY gain as it continued to benefit from programs such as Xbox 360. As expected, the volatile biomedical sector turned out to be a drag in December, given the higher base a year earlier. Pharmaceuticals output declined a sharp 25% YoY, reversing the 52% YoY gain in November. Manufacturing output growth ex-biomedical was 15% YoY in December, which was lowered to the headline figure of 5.1% once output loss from the biomedical sector was taken into account.

Upward revision to GDP growth for 2005. For the quarter, manufacturing output came in at 14.1% YoY, which is well ahead of official preliminary estimate of 11.5% YoY. This means that the final GDP figures for 4Q05/2005 are expected to be revised up. Based on our calculations, we see 4Q05 GDP growth at 8.3% from official estimate of 7.7%. This means that full year 2005 growth should reach 6.3%, from 5.7% (initial estimate) and 6% (recently rebased to year 2000). While there is no official word yet, the final report for 2005 economic performance is likely to be released on Thursday 16 February, one day before the FY2006 Budget announcement.

Outlook remains positive but watch for risk factors. As for outlook going forward, manufacturing sector growth is likely to be supported by momentum from the electronics sector in 1H06, while transport engineering (especially in offshore marine and aerospace) will be a key support given the strong rig orders. Key risk factors are the continued moderation in electronics demand in US for the past 12 months, as well as a 16-month streak of sub- 1.0 level for the SEMI book-to-bill ratio, which signals potential negative impact on the electronics sector in 2H06. With services sector strengthening on tourist arrivals, we continue to maintain our GDP growth forecast at 5.5% for 2006, with manufacturing sector growth projected at 7%.

tfwee · Veteran

UPDATE: Singapore Export Goal Cautious Despite Dec Surge

By Saeed Azhar
Of DOW JONES NEWSWIRES

SINGAPORE (Dow Jones)--Trade-dependent Singapore said its non-oil exports will grow 5% to 7% in 2006, a forecast analysts described as conservative after 2005 growth exceeded expectations and December's exports grew at their fastest pace in two years.

The city-state's non-oil domestic exports rose 8.2% in 2005 from a year earlier, slowing from 16% growth in 2004, but beating a target of 4% to 6% growth, International Enterprise Singapore said Tuesday.

Non-oil exports were worth S$599 billion in 2005 and total trade, which includes oil, was worth S$716 billion - nearly four times the size of Singapore's economy.

Singapore, a major refining center, focuses on non-oil exports to provide a clearer picture of the underlying trend.

Exports of non-electronics products such as drugs and chemicals rose 13% while electronics, which account for almost half of non-oil exports, grew a modest 3.9%, the city-state's trade body said

International Enterprise expects stronger growth for electronics in 2006, particularly for semiconductors, but warned there could be a moderation in petrochemicals and pharmaceuticals, which drove higher growth last year.

"Overall our growth rate will be moderated," Lee Yi Shyan, chief executive of Singapore's trade body told reporters. "We think 5% to 7% is stable growth for Singapore."

Lee said the forecast for 2006 is based on the assumption that oil prices will moderate to around US$55 to US$56 a barrel, which will crimp growth in the value of petrochemical shipments.

Pharmaceutical exports are also expected to moderate, with the European Chemical Industry Council predicting modest 4% growth in global pharmaceuticals production in 2006, he said.

The EU accounts for 72% of Singapore's pharmaceutical exports, and its share is rising due to presence in Singapore of multinationals such as Merck and Pfizer.

Global computer chip sales are likely to expand by 7%-8% in 2006, up from an estimated 6.5%-7.0% in 2005, the trade agency said quoting data from industry experts.

The growth in semiconductors will be spurred by higher demand for consumer products like mobile phones, sound and video devices, as well as digital television, it said.

International Enterprise expects exports of electronics to grow 5%-6% in 2006 compared with 3.9% in 2005, a deputy director at the agency, Ho Shih Chuan, said at the news conference.

Conservative Forecast

Analysts said the growth target for 2006 is conservative considering Singapore's export sector rebounded strongly in the second half as it and countries like South Korea and Taiwan benefited from stronger demand for electronics.

Surprisingly strong export growth for December suggests double-digit growth for 2006 exports is "within reach" despite the government's forecast, said David Cohen, an economist at Action Economics.

Exports in December surged 31.6% from a year earlier, with volatile pharmaceutical exports up 387% and electronics shipments up 16.2%, according to figures released Tuesday.

A Dow Jones Newswires poll of economists had forecast exports to grow 13.7% from a year earlier in December.

In seasonally adjusted terms, December's exports rose 18% from November.

Chua Hak Bin, an economist at DBS Bank, said he expects non-oil exports to grow 8% to 10% in 2006 though he warned the recovery in the electronics sector will be "shallow" because of an expected slowdown in the U.S. economy in the second half of 2006.

Pharmaceuticals, however, is a wild card because of the volatile nature of production as companies produce ingredients in batches, he said.

International Enterprise warned if oil prices exceed US$60 per barrel it may hurt the global economy and in turn affect Singapore's trade performance.

The trade agency said the U.S. economy will likely grow at a healthy rate of about 3.4% in 2006, only marginally lower than the expected 3.6% in 2005.

"Nevertheless, analysts also expect slower growth of personal consumption on the back of a slowing housing market, raising interest rates, relatively muted job gains as well as persistently high oil prices," it said.

As for Singapore's other major markets, International Enterprise predicted weakness in shipments to Japan and the EU this year.

But overall trade is forecast to grow 8% to 10% in 2006, led by China - which overtook Malaysia in 2005 to become Singapore's third largest market for non-oil exports - India and Southeast Asia.

KK · Guru

SINGAPORE : Singapore's economy grew by 5.7 percent this year, a rate that was much better than expected, Prime Minister Lee Hsien Loong has said in his New Year message. Mr Lee is hopeful of sharing surpluses the government has accumulated in the budget for the new fiscal year. Barring shocks, Singapore's economy should grow by 3 to 5 percent in 2006, Mr Lee added.

From tsunami recovery to terror attacks in London and Bali, 2005 has been an eventful year. And with twin engines China and India forging ahead, Mr Lee says the outlook in Asia remains favourable.

Singapore's economy grew by 5.7 percent in 2005 and unemployment fell to 3.3 percent. Some 78,000 jobs were created in the first three quarters of this year. This figure is expected to exceed the 100,000 figure for the whole of 2005, making it comparable to the situation in 2000. Investments in manufacturing and services are expected to generate over 18,000 new jobs, while wages increased by 4 percent. A record 9 million tourists visited Singapore, boosting the hotel and restaurant sectors. And external trade grew by 14 percent, helped by an expanding network of free trade agreements.

But Mr Lee acknowledged that with continued economic restructuring to maintain growth, some Singaporeans will find it harder to cope. So, he is hopeful that in the budget for the new fiscal year 2006, he will be able to share surpluses not just with all Singaporeans, but also with specific groups that need more help, like older people, lower income households and National Servicemen.

Mr Lee also touched on the NKF saga. Realising it might have shaken Singaporeans' confidence in other charities too, Mr Lee said, "The Government is also straightening out the roles of the various departments responsible for supervising charities and enforcing the rules, and developing a framework that supports good corporate governance in charities." He added, "If we discover any criminal wrong-doing, the authorities will pursue the matter without fear or favour, in order to maintain the confidence that Singaporeans have rightfully placed in the institutions and people that serve the public." But at the same time, Mr Lee urged Singaporeans from all walks of life -- workers, taxi drivers, housewives -- to continue donating to charity. Otherwise, he said, society will be the poorer for it. And if they felt something was not right, he urged them to let the authorities know.

On terrorism, Mr Lee said it is a major threat to Singapore's stability and growth. Pointing at how the British people remained calm and resolute through the London bombings, he said Singapore's emergency services and people must also be similarly prepared. This is why a major exercise involving the public transport system will take place in the next two weeks.

Looking ahead, Mr Lee said Singaporeans have every reason to be confident and must continue to seize opportunities and work hard together to secure a better future.

Mr Lee wishes all Singaporeans a Happy New Year. - CNA /ct

KK · Guru

BT, November 17, 2005, 1.00 pm (Singapore time)
S'pore Oct exports jump 10%

SINGAPORE - Non-oil domestic exports (NODX) grew a robust 9.8 per cent to $13.1 billion in October over the same period a year ago, beating economists' expectations, as shipments of electronics and chemical jumped, according to International Enterprise Singapore on Thursday.

NODX increased a seasonally adjusted 9.9 per cent in October from September, IE said in a media release.

"The third quarter was driven by external demand and the trend is continuing into the fourth quarter. The electronics number is quite strong and the sector continues to build up momentum," said Daniel Hui, an economist at JP Morgan Chase.

Electonics shipments rose 8.5 per cent in October from the previous year but drug exports fell 3.5 per cent.

Another economist, Leslie Khoo from 4Cast Ltd said he was surprised at the strength of electronics exports. "We expected the segment to slow down a bit. For petrochemicals, the average trend will likely be quite steady while pharmaceuticals will remain volatile."

Except for the US and Hong Kong, NODX to the rest of the top-ten markets registered positive growth, with China, Malaysia and Taiwan as the top three contributors to growth, IE said.

KK · Guru

BT, November 17, 2005, 9.05 am (Singapore time)
S'pore raises 2005 growth forecast to 5%

SINGAPORE - The Ministry of Trade and Industry on Thursday raised its full-year economic growth forecast to 5 per cent, from a range of 3.5 to 4.5 per cent, after a surge in drug production led to higher-than-expected third-quarter growth.

The Ministry said the economy grew at a seasonally adjusted, annualised rate of 7.1 per cent in the third quarter, above market expectations, due to stronger exports, data showed on Thursday.

The rise in gross domestic product compared with a median 6.3 per cent increase expected by economists and was more than double the government's advance estimate on Oct 10 of 3.2 per cent.

'The slowdown in economic growth early this year has been more than reversed by the strength of the rebound,' in the second and third quarters, the Ministry said in a statement. 'This resurgence - led by manufacturing, financial services and entrepot trade - mirrored the improvement in the global economy.'

GDP seen 3-5% in 2006

The government on Thursday also forecast that GDP growth for 2006 would be in the range of 3 per cent to 5 per cent, which is in line with the central bank's forecast.

'The government's GDP growth forecast of 5 per cent (for 2005) looks reasonable, and a growth range for next year of between 3 per cent and 5 per cent is a reasonable forecast range to start off from,' said Chua Hak Bin, economist at DBS Group Holdings Ltd.

Analysts said they had expected a surge in drugs production to significantly boost third-quarter GDP compared with the advance estimate, which is largely based on data covering the first two months of the July-to-September quarter.

'Really, it's companies producing extra pills in September that's had this big boost effect. Its impact on the domestic economy is minimal because it's foreign companies located here that are producing more output,' said Nigel Rendell, an economist at CLSA Asia-Pacific Markets.

Q3 GDP up 7%

From a year earlier, GDP rose 7.0 per cent in the third quarter, above market expectations for an increase of 6.8 per cent, the data from the Ministry of Trade and Industry showed.

The ministry also revised second-quarter growth upwards to a seasonally adjusted and annualised 19.0 per cent from 18.0 per cent. In the first quarter the economy contracted 4.6 per cent.

tfwee · Veteran

RE: Singapore Economy

KK · Guru

Q3 Jobless Rate

KK · Guru

Singapore GDP

tfwee · Veteran

Extracted from UOBKH

# NODX contracted by 0.4% in September after expanding by 7.1% in August.
# This was significantly below market and our expectations of 6.6% growth.
# The poor performance in August was due to the weakness in pharmaceuticals, which we had expected to continue its upswing.
# Instead, pharmaceuticals contracted by 22.1% in September as shipments to the EU fell.
# This in turn dragged down the non-electronics component of the NODX by 2.6% in September.
# The good news is that electronics continued to hold its own - the sector expanded by 1.7% yoy in September, better than the 0.5% we were expecting.
# With the exception of ICs (up 1.8% yoy), all other components of the electronics segment contracted yoy as a result of the high base of comparison in Sep 04.

Comments:

* We should not be overly concern with the fall in September's NODX. Instead, we are awaiting the release of September's industrial production to have a better gauge of the direction the economy is heading.
* In all probability, we do not think that this is a tipping point but a blip in the NODX numbers.
* 3Q05 flash GDP estimates could be revised downwards as a result of the weaker-than-expected NODX but we do think this will affect our overall forecast for GDP in 2005 significantly.
* We remain optimistic about prospects for the Singapore economy, given the recovery in the electronics segment. On a mom basis, disk drives, ICs, parts of PCs, PCs and Telecoms have all continued to expand healthily.
* Already our leading indicators for the electronics sector, namely the SEMI book-to-bill ratio and the US new orders for electronics products have shown improvement in the August, suggesting a recovery in electronics demand is underway. This is also reflected in the Singapore PMI for electronics which jumped 2.5 points to 55.6 in September.
* Moreover, seasonal demand (Christmas holidays) should boost demand for electronics and thus provide further support for NODX in the months ahead.
* If we were to exclude the total chemical sector (including pharmaceuticals and petrochemicals), NODX expanded by for the third consecutive month by 2.7%. This suggest that there is underlying strength in the export shipments.
* Of course, the wild card is the pharmaceutical sector, which remains volatile given the lumpy nature pharmaceutical production. We believe that we should see a recovery in pharmaceutical shipments in the months ahead that would lift NODX growth.
* We therefore maintain our NODX forecast for 2005 at 5.5%, which is at the upper end of IE Singapore's forecast of 4-6%.

tfwee · Veteran

DATA VIEW: Singapore Sep Exports Drop; May Hurt 3Q GDP

SINGAPORE (Dow Jones)--Singapore's exports fell for the first time in four months as drug and chemical shipments - which had powered an economic recovery since June - stumbled in September.

The drop overwhelmed a modest recovery in electronics exports and suggests the government may have to cut a preliminary estimate of 6.0% gross domestic product growth for the third quarter that was largely based on data from July and August.

Non-oil domestic exports contracted 0.4% in September from a year ago to S$12.19 billion, International Enterprise Singapore, the city-state's trade promotion agency, said Monday.

This was a deterioration from August's 7.1% growth and to the average forecast of 6.8% growth in a Dow Jones Newswires poll.

On a seasonally adjusted basis, Singapore non-oil exports declined for a second month, contracting 3.3% in September. Economists had predicted an average of 3.3% growth following August's 2.7% decline.

Economists had predicted strong growth in non-electronic exports based on August's 13.0% rise, but instead, that sector fell 2.6% in September, with pharmaceuticals as the main drag.

Song Seng Wun, a regional economist at CIMB-GK Pte. Ltd., said it is possible that the decline in pharmaceuticals and petrochemicals will drag down the chemical cluster in September, and manufacturing output for that month will ease from August.

If that happens, the government may also revise down its third-quarter GDP estimate, he said.

The key data also hurt Singapore's financial markets. The Singapore dollar and the stock market weakened on the news and on data showing August retail sales fell 9.7% from July due to lower car sales and the end of the Great Singapore Sale.

The U.S. dollar rose from its intraday low of S$1.6861 after the local data were released. At 0842 GMT, the U.S. dollar was at S$1.6893.

In the stock market, the Straits Times Index slipped as traders worried that the data could jeopardize Singapore's economic outlook for the full year. At 0842 GMT, the STI was down 0.6% at 2290.24 points.

Electronics Still On Upswing

Drug shipments dropped 22.1% in September from a year ago after posting strong growth in July and August.

CIMB's Song said the fall was possibly due to a change in product mix or a facility shutdown for routine maintenance. The IE didn't say why drug shipments fell so sharply.

The value of pharmaceutical exports was S$961.9 million, which Song said marked the first time it was below S$1 billion in six months.

Pharmaceuticals were also behind the 11.3% drop in total chemical exports, their biggest fall since November 2001.

"Part of that is there is usually strength in petrochemicals that offsets a fall in pharamceuticals," Song said. This time, both fell.

Petrochemical exports were down 2.0% from a year ago, which Song said was mainly due to a high base effect. Petrochemical exports declined 0.8% in August.

Ho Woei Chen, economist at United Overseas Bank, also agreed the forecast may be revised down due to the "lumpiness" in pharmaceutical output, but said she expects pharmaceutical exports will pick up in the second half after drug production surged 52.3% in August.

"There's a delay between production and exports," Ho said.

Other economists took a sanguine view.

"It's not a disaster because you know this sector (pharmaceuticals) is very volatile. It's not a trend," said Nizam Idris, deputy head of research of IDEAglobal.

In addition, non-oil retained imports of intermediate goods were strong, which is a good indicator for future exports, and seasonally adjusted electronics grew at a decent pace, Idris said.

Non-oil retained imports posted a seasonally adjusted 4.6% expansion from the previous month, although that was slower than August's 7.7% increase.

Electronics grew 1.7% in September from a year ago, matching August's rate of expansion.

Idris said electronics are on a gradual upswing and that will continue for the rest of the year.

While Singapore appears to be lagging Taiwan and South Korea in the regional electronics recovery, Idris said this is just a repeat of 2003.

"It's an indication of the different product mix," he said.

Idris said the upswing in Taiwan and South Korea will eventually trickle down to countries like Singapore because the products are interconnected.

KK · Guru

Spore's Q3 GDP expands 6% on year, boosted by biomedical sector

Singapore's economy expanded 6 percent year-on-year in the third quarter, thanks to an upsurge in biomedical manufacturing. This was according to advance estimates released by the Ministry of Trade and Industry on Monday.

On an annualised basis, the economy grew 3.2 percent, just slightly below market expectations. Still, some economists believe Singapore is on track to exceed its full year growth forecast of between 3.5 and 4.5 percent. Singapore's economy continues its growth momentum in the third quarter.

Advance estimates show that the manufacturing sector has grown 10 percent in the quarter, driven by transport engineering and chemicals. The construction sector however continued to decline although at a slower rate of contraction of 0.7 percent, compared to the previous quarter. Meanwhile, the services sector is estimated to have expanded 5.1 percent as financial services and business services grew at a faster pace.

Euben Paracuelles, Economist, DBS Bank, said: "The disappointment comes from the services sector which grew at the same pace as it did in the second quarter. Our services index point otherwise. It shows that the services sector may have been stronger than what the estimates suggest. But having said that, I think 6 percent is still a very decent number, considering the fact that electronics and construction were not there."

But analysts are already seeing signs of a recovery in the electronics sector. They expect electronics to post stronger numbers in the 4th quarter - although the sector's rebound will likely be at a gradual pace. There's also optimism that the construction sector will turnaround soon. Analysts say construction should further narrow its contraction in the 4th quarter and record positive growth by early next year.

Some economists expect the government to raise its forecast for the full year when the official third quarter numbers are released in November. They say the economy is likely to grow 5 percent this year as manufacturing and construction activities continue to gather pace.

Analysts warn that high oil prices will continue to be the biggest risk factor for the economy.
But with continued economic growth and rising inflation, they expect the central bank will stick to its policy of a modest and gradual appreciation of the Singapore dollar in its review on Tuesday. - CNA /ch

KK · Guru

Singapore shares firm on better-than-expected GDP data

SINGAPORE : Singapore share prices closed 1.66 percent higher on Monday, boosted by better-than-expected economic growth of 6.0 percent in the third quarter. The ST index rose 38.15 points to 2,343.39 on a volume of 1,288.6 million shares. There were 381 advances against 190 losing issues.

Preliminary figures released by the government Monday showed gross domestic product (GDP) grew 6.0 percent in the September quarter from a year ago and is faster than the revised 5.4 percent recorded in the June quarter. Analysts said the preliminary figures indicated the economy was well poised to beat the official growth target of 3.5 to 4.5 percent for this year.

"Market sentiment was buoyed by the positive GDP data," said a dealer at a local brokerage. Banks, which are regarded as proxies to the economy all chalked up gains by the close of trading. DBS added 40 cents to S$16.30, United Overseas Bank was 20 cents up at S$14.20 and Oversea-Chinese Banking Corp gained 15 cents to S$6.45.

Property stocks were also winners as demand could pick up due to the improved economic sentiment, dealers said. Heavyweight property firm City Developments jumped 15 cents to S$9.40, CapitaLand added four cents to S$3.40, Keppel Land surged 12 cents to S$4.24 and Singapore Land advanced five cents to S$5.65.

Other blue chips also gained with Singapore Telecommunications three cents higher at S$2.49, Singapore Airlines advancing 20 cents to S$11.60 and ST Engineering adding one cent to S$2.53. For the technology sector, Chartered Semiconductor dropped one cent to S$1.11, Venture fell 10 cents to S$13.60 but Creative Technology rose 10 cents to S$12.40. - AFP /ch

tfwee · Veteran

Extracted From UOBKH

Advance GDP – 3Q05

Strong pick-up in manufacturing

Singapore's economy expanded by a robust 6.0% yoy in 3Q05, which was an acceleration from 2Q's +5.4%. We were spot on in our forecast. The robust growth came on the back of a strong pick-up in manufacturing, which was up 10.0% yoy in 3Q05 − just a tad better than our forecast of 9.8%. Services continued to expand, rising 5.1% yoy in 3Q when we were expecting a slight retreat to 4.9%. Construction remained in the red, contracting by 0.7% yoy in 3Q, and this was a marginal improvement from 2Q's -0.8%.

The headline numbers suggest the underlying strength of the economy is picking up, especially since growth in the quarter was driven by non-electronics manufacturing, namely pharmaceutical, marine transport engineering and petroleum manufacturing. Moreover, services continues to be a pillar of strength
for the Singapore economy, spurred by stronger growth in the financial services
and business services sectors. This is not surprising given the strong run in the
stockmarket in late-July to early-August, and the pick-up in the physical property
market segment in the quarter.

The economy is on target to achieve 5.0% growth in 2005. We expect the
economy to remain buoyant as another leg of the economy should kick in when
the recovery in electronics demand accelerates. The Singapore economy is on
track to achieve our house growth target of 5.0% in 2005.