SINGAPORE (REUTERS) – The International Monetary Fund (IMF) has trimmed its 2019 economic growth forecast for Singapore to 2 per cent from 2.3 per cent, the Washington-based lender said on Tuesday (July 16), as global trade tensions hit exports from the city-state.
Singapore’s economy grew just 0.1 per cent in the second quarter, its slowest annual pace in a decade, raising bets of a recession and monetary policy easing.
“Given global trade tensions, support from external sectors is expected to fall and growth drivers are projected to shift back to domestic demand,” the IMF said.
“Risks to the outlook are tilted to the downside and mainly stem from external sources, including a tightening of global financial conditions, escalation of sustained trade tensions, and deceleration of global growth.”
Singapore’s economic growth should stabilise around 2.5 per cent over the medium term, the IMF said, adding that its forecasts were based on discussions with Singapore officials that ended on May 14.
Singapore’s central bank forecasts growth this year to be between 1.5 per cent and 2.5 per cent, down from 3.2 per cent in 2018.