Singapore's 2Q13 GDP growth predicted to hit 2.5%

Versus 1Q's disappointing 0.2%.

According to Nomura, their prediction is pointing to higher Q2 GDP growth of 2.5% y-o-y as of April/May versus 0.2% in Q1.

However, Nomura said that activity will be weaker in June as result of the negative economic disruptions caused by the severe haze, which was a result of the forest fires in Indonesia (namely through lower tourism, restaurant and retail sales).

Here's more from Nomura:

The global financial market sell-off may have also delayed investments and could result in negative wealth effects should it persist (especially from rising domestic interest rates).

So, we believe the rise in our monthly composite GDP index is only a brief respite. As such, for full-year 2013 we reiterate our GDP growth forecast of 1.5% versus the official GDP growth forecast of 1-3%.