christie@mediacorp.com.sg
THE economy's growth so far this year reads like a tale of beating the odds.
.
A recent hiccup in the supply of sand has done little to stop Singapore's builders from scoring their fastest expansion in six years, while the electronics sector here has managed to improve despite an ongoing global tech slump.
.
On the whole, analysts were pleasantly surprised by the official estimate that the first quarter grew by 6 per cent from that of a year ago. "It shows the economy is relatively resilient and growth is more broad-based," said OCBC economist Selena Ling, who had predicted an expansion of 5.4 per cent and may upgrade her full-year forecast.
.
The Government's preliminary data released yesterday also exceeded the 4.9-per-cent median forecast of nine pundits polled by Bloomberg.
.
Although the integrated resorts have not started on their mega-works yet, the construction sector surged 7 per cent in the first three months.
.
This, despite Indonesia's refusal since February to sell land sand to Singapore.
.
This suggests the ban will not dent the industry's recovery since late 2005, although building costs this year are likely to rise by 1 to 2 per cent, said United Overseas Bank (UOB). The Government's efforts to find alternative sand and granite supplies will also help mitigate cost pressures, added Ms Ling.
.
"We continue to anticipate a strong outlook for construction in 2007 with the slew of en-bloc sales in 2006 starting to translate into new development projects," UOB economists said in a research report yesterday.
.
Tourism developments bode well for jobs and wage hike prospects too, said Ms Ling.
.
Other pockets of the economy are also holding up. Services-producing industries, led by the financial and tourism sectors, continued to post "healthy growth" in the first quarter, said the Trade and Industry Ministry, which will post the actual numbers next month.
.
In manufacturing, strength in transport engineering and chemicals have been compensating for the slack in electronics, where global restructuring and price wars are underway.
.
These developments should help Singapore reach the official full-year growth forecast of 4.5 per cent to 6.5 per cent this year, said analysts.
.
A robust economy, however, puts upward pressure on prices due to increased demand. To contain inflation and import costs over recent years, the Singapore dollar has been allowed to appreciate at a "modest and gradual" pace since April 2004, the Monetary Authority of Singapore (MAS) said in its twice-yearly policy statement yesterday. So, although 2007 economic growth will likely trail last year's 8-per-cent pace, the MAS will maintain its policy for now.
.
"Looking ahead, the external environment is expected to remain broadly supportive of sustained growth. Financial conditions are mostly favourable with inflation well contained," the MAS said. Its optimism comes amid emerging risks such as a United States slowdown and a weak technology industry.
.
Punters seem even more bullish. Yesterday's growth flash led them to pick up banking counters — which trade as proxies to the domestic economy — pushing the local ST Index to hit a new closing high of 3,422.62 points.
Christie Loh
christie@mediacorp.com.sg
THE economy's growth so far this year reads like a tale of beating the odds.
.
A recent hiccup in the supply of sand has done little to stop Singapore's builders from scoring their fastest expansion in six years, while the electronics sector here has managed to improve despite an ongoing global tech slump.
.
On the whole, analysts were pleasantly surprised by the official estimate that the first quarter grew by 6 per cent from that of a year ago. "It shows the economy is relatively resilient and growth is more broad-based," said OCBC economist Selena Ling, who had predicted an expansion of 5.4 per cent and may upgrade her full-year forecast.
.
The Government's preliminary data released yesterday also exceeded the 4.9-per-cent median forecast of nine pundits polled by Bloomberg.
.
Although the integrated resorts have not started on their mega-works yet, the construction sector surged 7 per cent in the first three months.
.
This, despite Indonesia's refusal since February to sell land sand to Singapore.
.
This suggests the ban will not dent the industry's recovery since late 2005, although building costs this year are likely to rise by 1 to 2 per cent, said United Overseas Bank (UOB). The Government's efforts to find alternative sand and granite supplies will also help mitigate cost pressures, added Ms Ling.
.
"We continue to anticipate a strong outlook for construction in 2007 with the slew of en-bloc sales in 2006 starting to translate into new development projects," UOB economists said in a research report yesterday.
.
Tourism developments bode well for jobs and wage hike prospects too, said Ms Ling.
.
Other pockets of the economy are also holding up. Services-producing industries, led by the financial and tourism sectors, continued to post "healthy growth" in the first quarter, said the Trade and Industry Ministry, which will post the actual numbers next month.
.
In manufacturing, strength in transport engineering and chemicals have been compensating for the slack in electronics, where global restructuring and price wars are underway.
.
These developments should help Singapore reach the official full-year growth forecast of 4.5 per cent to 6.5 per cent this year, said analysts.
.
A robust economy, however, puts upward pressure on prices due to increased demand. To contain inflation and import costs over recent years, the Singapore dollar has been allowed to appreciate at a "modest and gradual" pace since April 2004, the Monetary Authority of Singapore (MAS) said in its twice-yearly policy statement yesterday. So, although 2007 economic growth will likely trail last year's 8-per-cent pace, the MAS will maintain its policy for now.
.
"Looking ahead, the external environment is expected to remain broadly supportive of sustained growth. Financial conditions are mostly favourable with inflation well contained," the MAS said. Its optimism comes amid emerging risks such as a United States slowdown and a weak technology industry.
.
Punters seem even more bullish. Yesterday's growth flash led them to pick up banking counters — which trade as proxies to the domestic economy — pushing the local ST Index to hit a new closing high of 3,422.62 points.
Christie Loh
christie@mediacorp.com.sg
THE economy's growth so far this year reads like a tale of beating the odds.
.
A recent hiccup in the supply of sand has done little to stop Singapore's builders from scoring their fastest expansion in six years, while the electronics sector here has managed to improve despite an ongoing global tech slump.
.
On the whole, analysts were pleasantly surprised by the official estimate that the first quarter grew by 6 per cent from that of a year ago. "It shows the economy is relatively resilient and growth is more broad-based," said OCBC economist Selena Ling, who had predicted an expansion of 5.4 per cent and may upgrade her full-year forecast.
.
The Government's preliminary data released yesterday also exceeded the 4.9-per-cent median forecast of nine pundits polled by Bloomberg.
.
Although the integrated resorts have not started on their mega-works yet, the construction sector surged 7 per cent in the first three months.
.
This, despite Indonesia's refusal since February to sell land sand to Singapore.
.
This suggests the ban will not dent the industry's recovery since late 2005, although building costs this year are likely to rise by 1 to 2 per cent, said United Overseas Bank (UOB). The Government's efforts to find alternative sand and granite supplies will also help mitigate cost pressures, added Ms Ling.
.
"We continue to anticipate a strong outlook for construction in 2007 with the slew of en-bloc sales in 2006 starting to translate into new development projects," UOB economists said in a research report yesterday.
.
Tourism developments bode well for jobs and wage hike prospects too, said Ms Ling.
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