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Economists trim Singapore 2014/15 growth forecasts: MAS survey
December 17, 2014 / 4:07 AM / 3 years ago

Economists trim Singapore 2014/15 growth forecasts: MAS survey

SINGAPORE (Reuters) - Economists have cut their estimates for Singapore’s economic growth in 2014 and 2015 from three months ago and lowered forecasts for inflation, a central bank survey showed on Wednesday.

Labourers work on scaffolding near the Marina Bay Sands casino and resort in the financial district of Singapore August 22, 2014. REUTERS/Edgar Su

The median forecast of 22 economists surveyed by the Monetary Authority of Singapore (MAS) was for gross domestic product (GDP) to expand 3.0 percent this year, down from expectations for 3.3 percent growth in a survey published in September and growth of 3.9 percent last year.

Economists also trimmed their 2015 growth forecast to 3.1 percent from 3.7 percent previously.

Such expectations are in line with the government’s forecast for growth of around 3 percent this year and 2 to 4 percent expansion in 2015.

A tepid and uneven global recovery has tempered Singapore’s economic growth this year.

Headwinds have also come from the government’s push to reduce a politically unpopular reliance on foreign workers. That has led to a tight labor market and raised business costs.

The MAS survey shows that economists see core inflation at 2.0 percent for the year, down from 2.2 percent in the previous survey. They also see core inflation slipping to 1.9 percent in 2015, down from 2.5 percent in the September survey.

The MAS has said it expects core inflation, which excludes changes in the prices of cars and accommodation and is the focus of monetary policy, to average 2-2.5 percent in 2014 and 2-3 percent in 2015.

Economists also trimmed their forecast for all-items inflation to 1.1 percent this year, down from 1.8 percent in the previous survey. They expect headline inflation to come in at 1.1 percent again in 2015, down from 2.2 percent previously.

The MAS has said it expects CPI-all items inflation to come in at 1-1.5 percent in 2014 and 0.5-1.5 percent in 2015.

Headline consumer inflation has fallen this year due to a moderation in housing costs and car prices but core inflation has stayed relatively firm on the back of wage cost pressures.

Reporting by Masayuki Kitano; Editing by Jacqueline Wong

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