The Monetary Authority of Singapore released the semi-annual Macroeconomic Assessment this morning (28th) and pointed out that with the gradual recovery of production, Singapore’s gross domestic product (GDP) in the third quarter rebounded significantly from the second quarter, but contracted 7 %.
As corporate and household expenditures are affected by reduced income and uncertain prospects, the pace of economic recovery in the next few quarters is expected to slow down. Singapore’s economy will shrink by 5% to 7% this year.
The “Macroeconomic Assessment” pointed out that after the outbreak of the new crown pneumonia, Singapore’s economy fell to the bottom in the second quarter, and GDP fell by 13.2% year-on-year.
In contrast, the average GDP decline during the 1997 Asian financial turmoil, the 2001 technology bubble and the 2008 global financial crisis was 6.1%. The world pandemic is not over yet.
All these indicate that the economic slowdown caused by the pandemic is expected to last longer and have a deeper impact than previous crises. Singapore’s economy also needs more time to recover.
The HKMA also stated that even if the job market recovers next year, some economic sectors, especially tourism-related industries and service industries that require intensive social contact, are unlikely to return to pre-epidemic levels by the end of next year.
The unemployment rate of residents will continue to be at a relatively high level, which will also lead to a sluggish salary increase.