With the global recession getting better and with signs of regional recovery prompting policy makers to end the stimulus measures, it is believed that the Singapore economy has expanded for a second quarter.
Based on the median estimate of 15 economists that Bloomberg News has surveyed, after the growth of 20.7 percent from April to June, the gross domestic product increased last quarter to an annualised 14.5 percent from the last three months. The data will be released by the trade ministry today.
This year, the standard stock index of Singapore surged by 51 percent, and as the nation recovered from its worst recession since 1965, the property prices increased. Economists forecast that central bank is likely to delay until April any variation from its currency policy.
“As the recovery in the economy and property market continues, the risk of sector-specific tightening measures or removal of accommodation is growing,” Singapore UBS AG Economist Edward Teather said. “The debate on stimulus withdrawal is likely to hot up.”
Since the Great Depression, Asia has led the recovery of the world from its severest recession. By next year, the International Monetary Fund forecasts that there will be an expansion in the gross domestic product in developing Asia.
This week, among the group of 20 nations, Australia is the first to put up borrowing costs since the peak of the financial turmoil. According to Lee Seong Tae, governor of Bank of Korea, he could raise borrowing costs to curtail the increasing property prices in an economy which has abruptly expanded. It is the fastest pace in almost 6 years.
The government of Singapore forecasts that the economy will incur a loss of 4–6 percent by 2009. Goldman Sachs Group Inc., economists at UBS and DBS Group Holdings Ltd are confident, given the estimates that surpass the expectation of the government. While a 1.8 percent loss is being expected by Goldman Sachs, UBS predicts a decline of 1.5 percent this 2009.
Based on the survey conducted by Bloomberg, in the three months ended September 2008, the $182 billion economy of Singapore expanded by 0.5 percent. It was the first recorded growth in a year.