Singapore GDP to register 'massive upward revisions' in 4Q13

Thanks to industrial production's surprising jump.

According to DBS, GDP growth figures for 4Q13 will see some massive upward revisions as well. Once again, the earlier projection of a contraction of 2.7% QoQ saar will get revised to an expansion of about 1.7%. That’s a full 3%pt revision!

In year-on-year basis, it’ll be 5.5% YoY rather than 4.4% for the quarter. That’s a full percentage point higher. So, this will effectively bring full year GDP growth closer to 4.0% rather than the earlier estimate of 3.7%.

Here's more:

Headline industrial production index for December posted a robust expansion of 6.2% YoY when consensus was expecting a contraction of about 1.4%. What a massive surprise! The continued strong performance in the electronics cluster was probably priced in.

But a simultaneous surge in output from the biomedical and transport engineering clusters probably caught everyone off-guard. Well, that’s the amazing nature of this economy. It’s small, open and extremely volatile. This is probably one of the things that makes an economist’s job here so interesting.

In absolute index basis, this is the highest level of industrial output since Mar 08! And the production number for the previous month has also been revised significantly higher. So what does that imply?

Well, manufacturing growth for the fourth quarter will now be revised to 7.0% YoY instead of 3.5% as previously reported in the advance estimate. Yes, that’s a doubling of the manufacturing growth number.