SINGAPORE, June 8 (Reuters) – Inflation is the biggest downside risk to Singapore’s economy this year, but the recovery in China and a broader recovery in global travel will support the city-state’s growth, a survey by the central bank.
Singapore’s economy is expected to grow 4.8% in the second quarter and 3.8% for the year as a whole, down from the 4.0% seen in the previous survey in March, according to the survey of 24 economists conducted in May by the Monetary Authority of Singapore (MAS).
A stronger-than-expected rise in inflation, driven mainly by higher energy and food prices, was the most cited downside risk to Singapore’s outlook in the survey, while weaker growth More robust China, supported by easing macroeconomic policy and reopening the economy, was seen as a key driver.
A recovery in travel as well as a stronger-than-expected expansion in manufacturing output would also support Singapore’s growth, he said.
Survey respondents saw median growth of 5.0% for headline inflation this year and 3.4% for the core inflation rate, the central bank’s preferred price measure.
Both were higher than previous poll numbers in March and were in line with central bank forecasts.
The MAS has tightened its monetary policy three times in the space of six months to combat inflation resulting from the disruption of the global supply chain.
(Reporting by Chen Lin; Editing by Martin Petty)
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