Singapore’s economy may shrink by 6% this year: Report

According to a survey conducted by the Monetary Authority of Singapore (MAS), that surveyed 26 economists and analysts suggest that the economy may turn more bullish over the strength of a recovery through next year, suggesting the worst of the coronavirus-induced contraction has passed.

The economy may shrink by six percent this year, according to a quarterly survey by the MAS, slightly worse than the 5.8 per cent contraction predicted in the previous June survey.

However, the professional forecasters expected growth in gross domestic product to recover to 5.5 per cent in 2021, up from the 4.8 per cent they had tipped earlier, MAS said in its survey report released on Monday (Sept 7).

The downgrade of the full-year 2020 GDP in the latest MAS survey is predicated on a enervated outlook for construction, accomodation and food services, and private consumption. However, median forecasts improved for manufacturing, finance and insurance, wholesale and retail trade, and non-oil domestic exports over the June survey.

For the third quarter of this year, the analysts expected the economy to contract by 7.6 percent year on year, easing from the record 13.2 percent plunge in the second quarter.

Talking about the labour market, the respondents expected the seasonally adjusted unemployment rate to ease slightly to 3.5 percent at the end of this year, from 3.6 percent in the previous survey.

Corporate profitability, in the third quarter as well as for the whole of 2020, is expected to decline.