By Amanda Lee


SINGAPORE--Experts surveyed by Singapore's central bank have maintained their economic growth forecast for Singapore this year, though the composition of growth drivers has changed.

The Monetary Authority of Singapore's June survey, released Wednesday, showed that the median projection of economists and analysts is for gross domestic product growth of 2.4% in 2024.

The respondents forecast manufacturing to grow 1.6% this year, down from a 4.0% expansion projected in the March survey, and they predicted construction to grow 3.8%, compared with 4.9% growth predicted in the March survey. However, they forecast finance and insurance to rise 5.1% this year, up from 3.4% expansion projected in the March survey, and predict wholesale and retail trade to grow 2.5%, versus the 1.8% expansion forecast in the March survey.

Also, the respondents predict accommodation and food services to grow 3.1% this year, compared with the 2.2% growth forecast in the March survey. They project nonoil domestic exports to increase by 4.0% this year, down from the 6.0% expansion predicted in the March survey, and they forecast private consumption to rise 3.4% this year, up from 3.0% growth projected in the March survey.

The MAS survey's respondents predict that Singapore's GDP will expand by 2.5% in 2025.

Spillover from geopolitical tensions emerged as the most-cited downside risk to Singapore's outlook, the MAS survey showed. Inflationary pressures, a slowdown in external growth and spillover from weaker growth in China were also seen as downside risks by respondents.

More robust growth in China was the most frequently cited upside risk to Singapore's outlook by the respondents. The respondents also flagged faster-than-expected tech cycle recovery and better-than-expected external growth as upside risks.

Inflation is expected to ease this year, with headline inflation likely cooling to 2.8% from 3.1% projected previously, while the core inflation forecast was maintained at 3.0% this year, the survey showed.

The bulk of the respondents said they don't expect changes to the slope, width and level of the Singapore dollar nominal effective exchange rate policy band at the July and October reviews. For the July and October reviews, 11% and 6% of respondents, respectively, anticipate a reduction in the slope of the policy band. For the October review, 6% predicted a lowering of the level at which the S$NEER policy band is centered, the survey indicated.

The central bank's monetary policy is centered on Singapore's exchange rate, which it considers an effective tool for maintaining price stability in the small and open economy.

The MAS said the June survey was sent to 26 economists and analysts, of whom 20 responded, the results of which don't represent the central bank's own views or forecasts.


Write to Amanda Lee at amanda.lee@wsj.com


(END) Dow Jones Newswires

06-12-24 0032ET