How the services sector surprised the Singapore economy in 2Q13

Economy impressively jumped by 15.5%.

According to DBS, based on the final GDP figures for 2Q13 announced recently, the economy accelerated by 15.5% QoQ saar, up from a modest expansion of 1.7% in the previous quarter. In year-on-year terms, that’s a healthy 3.8% growth, from 0.2% in 1Q13.

So for the first half of the year, the island state grew by 2.0% over the same period last year.

Here's more from DBS:

While most in the market expected some degree of moderation, the headline number was being raised instead. Well, that’s the nature of this economy. It’s always volatile and often springs such surprises. More importantly, what led to this upward revision is a better than expected performance from the services sector. Although growth in the manufacturing sector was revised drastically downwards to 0.2%, from 1.1% in the advance estimates, the services sector has managed to pick up the slack.

Industrial production in June contracted by 5.9% and fell short of the expectation. Unexpected downswing in the pharmaceutical cluster and the subdued growth in the electronics segment have brought about the downward revision in the manufacturing growth.