Q1 GDP growth estimate may be revised up to 3.7% QoQ: analysts

The current flash estimate for Q1 GDP growth is 3.4%

The flash estimate for the first quarter (Q1) of 2022 gross domestic product (GDP) growth may be revised up to 3.7% quarter-on-quarter (QoQ) from 3.4% QoQ, according to OCBC Treasury Research.

In a report, the analyst said the revisions might be on the back of a better-than-expected March industrial production and retail sales data.

A 3.7% GDP growth in Q1 translates to a 0.6% QoQ increase from the previous quarter.

Despite the possibility of a higher GDP growth estimate, OCBC still expects the full-year forecast to remain at 3% to 5% given that there are "downside risks to [the second quarter (Q2) of 2022] due to the downgrade in global growth prospects and headwinds including China’s COVID-related lockdowns, supply chain disruptions and aggressive monetary policy tightening by major central banks like the FOMC."

OCBC, for its part, said they expect Q2 2022 GDP growth to be at 4.4% year-on-year (YoY) (1.1% QoQ), whilst the full-year figure will be at around 3.5-4.0% YoY.

Meanwhile, the higher expected flash estimate in Q1 will likely not push headline and core inflation higher based on OCBC's forecast.

OCBC said headline inflation will likely ease to 5.1% YoY, a decrease of 0.5% month-on-month, whilst core consumer price index will print at 3.4% YoY.