Singapore's economic growth accelerated in the second quarter, in signs the city-state's recovery is gaining momentum as manufacturing rebounded.
Gross domestic product expanded 0.4% in the three months to June from the previous quarter, the Ministry of Trade and Industry said in its advance estimate Friday. That matches the median expectation in a Bloomberg News survey and is quicker than a revised 0.3% gain seen in the January-March period.
Compared with a year ago, the economy expanded 2.9%, beating the survey forecast for a 2.7% increase. The MTI figures were mostly computed from data in the first two months of the second quarter.
Manufacturing halted two quarters of contraction, showing broad-based improvements. Construction also swung into growth in the April-June period, supported by increased public sector projects.
While the latest data puts the city-state on track with hitting a 1%-3% GDP growth target for 2024, a lot still depends on a durable recovery in global trade in light of continued geopolitical tensions. Easing price pressures also offers relief, suggesting that financial conditions won't have to be tightened further when the Monetary Authority of Singapore makes its policy decision later this month.
Exports in the trade-reliant economy remain sluggish though, contracting in four of the five past months to May. They are forecast to expand by 1.4% in June.
The zero growth in the services producing industries bears watching, as accommodation, food and real estate posted a 0.5 decline. – Bloomberg