Risks to Singapore economy are external, says IMF
SINGAPORE - An International Monetary Fund (IMF) staff team has reported that risks to the City-State’s growth outlook arise mainly from external sources. “Notwithstanding the recent recovery of trade, economic and geopolitical risks have risen and could affect Singapore’s highly open economy,” it says.
“The main external risks stem from the adverse impact of more inward-looking policies in major economies. Slowdowns in major emerging economies could adversely impact Singapore.
“On the other hand, spillovers from higher-than-expected growth in the US could lift near-term growth.
“Tightening in global financial conditions, including more rapid-than-expected normalization of US monetary policy and significant further strengthening of the US dollar, could adversely affect segments of the household and corporate sectors.”
The report adds: “The authorities’ financial sector and macro prudential policies have ensured financial stability.
“While elevated household and corporate sector leverage warrant continued monitoring, banking sector health remains sound, backed by high capital, liquidity, and profitability ratios, and still-low non-performing loans (NPLs). www.imf.org (ATI).