Boost from China reopening may skirt Singapore’s technical recession: analyst

Maybank said the possibility of a recession went up 30% from 22% in March 2008.

Despite slowing global growth, Singapore may still dodge a technical recession with support from China’s economic reopening, Maybank said.

In a statement, the analyst said the probability of a Singapore recession grew to 30%, higher than the 22% in March 2008 (before GFC). 

“China’s reopening has not had a meaningful impact on manufacturing and exports so far, but we expect a more visible impact on growth from the second quarter onwards, which should help decouple Singapore from a US recession,” said Maybank.

Maybank reiterated that it expects the Singapore central bank to “tighten monetary policy  mid-April meeting by re-centering the S$NEER band to dampen inflation.” 

“This would be the sixth consecutive tightening move since October 2021 and possibly the final one, as the economy is slowing due to weakened external demand,” it added.

Maybank also noted that the turmoil in the banking sector in the US and Europe, Singapore remains minimally affected.