Singapore raises its 2024 GDP growth forecast due to manufacturing expansion; lowers its headline inflation projection.

• In 2024, Singapore's economy is predicted to expand by 2.4%, while its headline inflation is projected to reach 3.1%.
• The current inflation forecast is lower than the previous survey's forecast of 3.4%, but higher compared with the 2.3% growth forecast in the December survey.
• According to a Bloomberg report, Taylor Swift's Eras Tour is predicted to increase Singapore's first-quarter GDP.

The Monetary Authority of Singapore's survey revealed on Wednesday that Singapore's economy is expected to grow faster in 2024 than previously estimated, while the inflation outlook has been revised to be lower.

This year's GDP growth is estimated to be 2.4%, higher than the December survey's estimate of 2.3%, while headline inflation is projected to be 3.1%, lower than the December survey's forecast of 3.4%.

In 2025, the city-state's economic growth is predicted to rise to 2.5%.

The manufacturing sector in Singapore, which accounts for more than 20% of the country's GDP, is projected to expand by 4% in 2024, an increase from the previous forecast of 2.3%.

The manufacturing, finance, and insurance sectors' forecasts were raised by economists, while the wholesale and retail trade, as well as accommodation and food services sectors, had their outlooks revised downward.

'Swiftonomics' to boost Q1 GDP

According to the survey, the first quarter's GDP numbers are expected to show an economic growth of 2.6%. These advance numbers will be released on April 12.

After the Singapore leg of Taylor Swift's Eras Tour, economists upgraded Singapore's first-quarter growth forecasts, according to a Bloomberg report on March 9.

According to DBS Bank economist Han Teng Chua, the concerts will contribute approximately SG$300 million to SG$400 million, or 20 basis points, to Singapore's first-quarter GDP. Swift had performed six shows in the country from March 2 to March 9.

The report stated that Singapore's gross domestic product is likely to increase by 2.9% in the first quarter.

Lower inflation

Although the MAS survey revealed that economists have revised their headline inflation forecasts from 3.4% to 3.1% for 2024, the median forecast for the "MAS core inflation" metric remained unchanged from the previous survey at 3%.

The MAS core inflation metric excludes accommodation and private transport from the overall inflation rate.

Headline inflation and MAS core Inflation are forecast at 2% for 2025.

The economists predict that Singapore's monetary policy will remain unchanged during the April 2024 review.

Singapore manages its monetary policy through the adjustment of exchange rate settings rather than a fixed benchmark interest rate, resulting in fluctuations in the value of the Singapore dollar within a secret range against a selection of its key trading partners' currencies.