Singapore's GDP growth forecast to hit 2.8% in 2017

Thanks to a robust economic growth in 4Q16.

DBS analysts have upgraded 2017 GDP growth forecast for Singapore to 2.8% (up +0.9 ppt) on the back of a robust 2016 fourth quarter, which registered the strongest quarterly growth in six years at 12.3% on-quarter, based on a seasonally adjusted annual rate.

“This translates to 2.8% on-year growth, with GDP growth for 2016 coming in at 2%, substantially above expectations and backed by significant upward revisions to previous quarters’ data as well,” said DBS.

Here’s more from DBS:

The key driver in fourth quarter 2016 was an 11.5% on-year surge in manufacturing growth, driven by semiconductor (up 62% on-year) and pharmaceutical (up 34% on-year) manufacturing.

The services sector grew by 8.4% on-quarter, seasonally adjusted annual rate, or by 1% on-year, led by financial (up 36.5% on-quarter) and trade-related services – transport and storage services rose by 12.4%.

Loan growth has bottomed and will likely trend higher. Container throughput and re-export growth have continued to creep higher too.