Singapore Q2 GDP Grows Annualised 14%

Source : The Business Times, August 10, 2007

Singapore's economy grew at a faster-than-expected annualised rate of 14.0 per cent in the second quarter, thanks to a boom in the construction and financial industries, data showed on Friday.

The seasonally adjusted rise from the previous quarter compared with 12.4 per cent growth forecast by analysts in a poll and the government's advance estimate of 12.8 per cent which was largely based on data from April and May.

Compared with a year earlier, gross domestic product (GDP) expanded 8.6 per cent in the second quarter, the Ministry of Trade and Industry said in a statement, faster than the median 8.0 per cent forecast by economists.

The government on Wednesday raised its full-year economic growth forecast to 7-8 per cent, from 5-7 per cent previously, putting it on a level with last year's strong expansion of 7.9 per cent.

'The improved outlook reflects higher growth in financial and business services, manufacturing and construction,' the Ministry of Trade and Industry said in a press statement on Friday.

'The driving factors underpinning the higher growth forecast are broad-based: strong global demand in the biomedical, aerospace and marine industries, robust regional demand for financial services, and a buoyant domestic property market.'

RELATED LINKS http://tinyurl.com/2tkgmd

MTI press release: Improved Outlook for 2007 As Growth Broadens and Economy Diversifies

The upgrade was widely predicted by economists, although some said that the government's forecast of 8 per cent was conservative given the economy's strong growth in the first six months. -- REUTERS

MAS ready to inject liquidity if needed

SINGAPORE - Singapore's Monetary Authority of Singapore is prepared to inject cash into the market to stabilise any fallout arising from problems in US sub-prime mortgages, an official said on Friday.

But Ong Chong Tee, MAS deputy managing director, said there was no need to do so at the moment and the central bank was sticking to existing monetary policy.

'In terms of domestic market liquidity, if there are liquidity bottlenecks, certainly we will come in to inject more liquidity,' he told a media briefing.

'But at this stage, the liquidity management is unchanged in the sense that we do not see any undue problems.'

Mr Ong said MAS 'will be watching the situation closely'.

In a separate statement issued after the stock market closed, MAS noted that the 'domestic markets have generally functioned smoothly' on Friday.

'The MAS does not comment on the specifics of our market operations which continue to be directed at ensuring sufficient liquidity conditions in the money markets and banking system, taking into account the various exogenous factors that impact on liquidity,' it said.

'However, given current global market conditions, we would like to reiterate that the Authority stands ready to inject additional market liquidity if the situation so warrants.' Singapore's trade ministry, which announced better-than-expected second quarter economic growth on Friday, separately said an escalation of the troubles in US sub-prime credits is a potential risk. -- AFP