International Monetary Fund release their latest review on Singapore 10 May 2016
- 2017 GDP rising to +2.5%
- GDP growth constrained by aging labour force
- 2016 headline and core CPI to remain subdued
- MAS must be vigilant to deflation signs
- monetary policy easing appropriate
- risks to outlook are to the downside
Say the IMF:
"GDP growth is projected to slow further to 1.8 percent in 2016 as the full impact of the slowdown in global trade and capital outflows experienced in 2015 are felt and private investment is held back by the uncertainties on the horizon. In surveys, companies report little appetite to hire and bank credit remains subdued. On the positive side, lower energy prices should support private consumption, government spending has been rising, and external demand should gradually recover. Growth is projected to improve to about 2.5 percent in 2017. Headline and core inflation are projected to remain subdued in 2016, before rising modestly in 2017 as energy and commodity prices are expected to gradually recover.
"Risks to the outlook are tilted to the downside. A sharper-than-expected slowdown in global growth is the most important short-term external risk. This could manifest itself through a significant downshift in China and other large emerging economies as well as weak growth in key advanced economies."
Full report here
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