Singapore’s Q2 GDP slumps, but recovery under way, says ANZ

July 14, 2020

SINGAPORE- Advance Q2 GDP estimates show the Singapore economy contracting by 12.6% y/y, sending the country into its deepest recession on record, but ina research note, ANZ Bank says that as large as the slump in economic activity was in Q2, it also marked the low point. "We expect growth to return to positive in Q3 on a sequential q/q basis," ANZ says.

"However, the recovery will be modest and bumpy, and we do not expect Singapore's real GDP to reach pre-COVID-19 levels until Q3 2021. We maintain our 2020 full-year GDP growth forecast at -5.9%."

ANZ says it expects the Monetary Authority of Singapore to keep monetary policy unchanged for the rest of the year.

"A further fiscal boost, on top of the four budgets delivered so far, cannot be ruled out to ensure the recovery takes hold amidst a still uncertain external environment." (ATI).