The possibility of Singapore’s economy experiencing “some quarters of negative growth” cannot be ruled out, although the government does not expect an outright recession, a government minister was quoted by local media as saying on Monday.
The comments came just days before a semiannual monetary policy decision by Singapore’s central bank and the release of the government’s advance estimate of third quarter gross domestic product, both of which are due on Friday.
“Our base line projection is not an outright recession, but we cannot rule out the possibility that the economy will experience some quarters of negative growth on a quarter on quarter basis,” Trade and Industry (Trade) Minister Lim Hng Kiang was quoted by local broadcaster Channel NewAsia as saying in Parliament.
Given the ongoing developments in the global economy, the government will continue to monitor the situation closely and stands ready to respond in the event of a downturn, Lim said.
He added that the government is still expecting the economy to grow between 1 to 2 percent for the full year, “albeit on the lower end of the projection curve”.
“Depending on the nature and severity of the downturn, the government is prepared to consider introducing a range of contingency measures, which could include broad-based as well as sector-specific measures,” Lim was quoted as saying.
The city state’s central bank, the Monetary Authority of Singapore, is expected to keep its exchange-rate based monetary policy steady at this week’s policy review, according to a Reuters survey.
Some analysts, however, say that external risks and sluggish growth may prompt a further easing in 2017, following a surprise easing in April.
The median forecast in a Reuters poll on third-quarter GDP is for Singapore’s economy to expand by 0.3 percent from the previous quarter on an annualised and seasonally adjusted basis.
