Chart of the Day: Check out how the services sector is reshaping Singapore’s economy

It has regularly picked up manufacturing’s slack.

The city-state’s gross domestic product (GDP) has once again surprised analysts with a 5.7% expansion in 4Q, and it’s all thanks to a surge in the services sector.

According to HSBC, the vitality of Singapore’s service sector has come at a time when manufacturing is in the middle of a 3-quarter slide, signalling structural changes that the economy is undergoing.

“Services sector output expanded by a robust 6.5% q-o-q saar following growth of 2.9% in 3Q,” HSBC said.

While the jump in the services sector was a feat in itself, HSBC points toward a surge in finance and insurance activity over the quarter.

“This would be consistent with previous years, when output from the sector - at least in GDP accounting terms - tends to pick up substantially in 4Q. For example, between 2012 and 2014, output from 'finance & insurance' rose by an average 31.4% q-o-q saar in the fourth quarter (seasonally-adjusted data),” HSBC said.