SINGAPORE: Economists have raised their forecasts for Singapore's growth in 2025 but see the pace moderating next year, with monetary policy expected to be held steady at a review next month, a survey of forecasters by the Monetary Authority of Singapore showed on Wednesday.
Most respondents in the December quarter survey cited geopolitical tensions as a top downside risk for the city-state, while four in 10 economists flagged the potential of the artificial intelligence bubble bursting, a risk that was not highlighted in the September quarter survey.
Meanwhile, a sustained AI-led tech cycle upturn and resilient global growth were seen as potential upside risks. The median forecast for growth this year was raised to 4.1% from 2.4% in the previous survey, with growth in 2026 seen moderating to 2.3%. In November, the trade ministry raised its GDP growth forecast for 2025 to "around 4.0%" from a previous range of 1.5% to 2.5%.
Economists expected year-on-year growth of 3.6% in the fourth quarter, the survey found. The MAS kept monetary policy unchanged at a review in October. The survey found that all economists expected no change to policy at the upcoming review in January, and most expected no change at the April review either.
For the July 2026 policy review, 11% of economists expected a tightening of policy, the survey found. The median forecasts for core inflation and headline inflation were at 0.7% and 0.9% respectively, unchanged from September, the survey showed. Economists see inflation picking up next year, with core inflation seen at 1.3% and headline at 1.5%, the survey showed.
At a policy review in October, the MAS said that core inflation should "average around 0.5%" for 2025, while headline inflation should "average 0.5% to 1.0%" this year. The survey, which was based on responses from 20 economists, was sent out on November 21, the day that data showed the economy grew 4.2% in the third quarter from a year earlier, beating market expectations and initial estimates. - Reuters
