Singapore's Economic Growth Solidifies; Continued Outlook Expected into 2025

Forex - The Monetary Authority of Singapore (MAS) announced that the country's economic recovery has solidified following a sluggish start to the year and is expected to continue to be supported by strong trade and a constructive global outlook.

The macroeconomic report published by MAS stated, "The economy is now expanding more distinctly."

MAS expressed an expectation for a generally favorable external environment to support growth until 2025.

It highlighted that Singapore's economic outlook is well-supported by the rise of the technology sector and the easing of global financial conditions.

According to the report, GDP growth this year is anticipated to be at the "upper end" of the forecast range of 2 to 3 percent, with a similar pace expected in 2025.

MAS indicated that Singapore's economy gained a more solid footing in the third quarter due to the expanding recovery in the manufacturing sector, increased trading activities in the financial sector, and the return of Chinese tourists.

Additionally, MAS stated that both headline and core inflation have continued to slow down with the alleviation of external and internal cost pressures. Core inflation is expected to further decline and finish the year around 2 percent, which is considered an important threshold in policymaking. While MAS does not have a specific target for inflation, it believes that core inflation, averaging just below 2 percent, is consistent with overall price stability in the economy.

The report projected that the headline inflation rate is expected to average between 1.5 and 2.5 percent in 2025.

MAS assessed that "significant uncertainty continues in the global economy and risks are generally tilted towards lower global growth."

Regarding monetary policy, MAS indicated that the current valuation of the policy band is consistent with medium-term price stability.