Singapore’s economy grew 4.4 percent year-on-year in the third quarter of 2022, the government said on Friday, while warning of ongoing global challenges such as inflation.
Economists often see the performance of the city-state’s open, trade-oriented economy as a barometer of global trade activity.
The Q3 reading was slightly below the 4.5 percent of the previous quarter, according to the preliminary estimates of the Department of Commerce.
“The expansion was partially underpinned by a stronger-than-expected recovery in the domestically-facing and travel-related sectors as more overseas and local Covid-19 restrictions were eased,” the Monetary Authority of Singapore said on Friday.
Singapore has lifted all Covid restrictions except for wearing masks on buses and subways after vaccinating most of its nearly six million residents and choosing to live with the coronavirus.
Quarter on quarter, Singapore’s economy grew 1.5 percent and avoided a technical recession, reversing the 0.2 percent contraction in the second quarter.
However, manufacturing output and financial services weakened due to slowing foreign demand, according to the central bank.
The MAS said it would continue to tighten monetary policy to fight inflation — its fifth such move since October 2021.
“In the coming quarters, the strain on economic activity from the globally synchronized tightening of monetary policy will intensify,” it said.
“While inflation should ease, it will remain high for some time.”
The MAS raised its inflation forecasts slightly, projecting core inflation of around 4.0 percent and headline inflation of around 6.0 percent in 2022.
“However, further shocks, including geopolitical tensions, could push up inflation and lead to year-round recessions in some key economies,” the bank added.
Singapore’s economy is expected to grow 3.0-4.0 percent in 2022 after officials slashed a previous forecast of 3.0-5.0 percent.
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