Q1 growth of 2.6% surprises on upside

Singapore

DESPITE a contraction in the manufacturing sector, the Singapore economy grew a better-than-expected 2.6 per cent year-on-year in the first quarter of 2015 - breezing past even the most optimistic of projections. Thanks to an acceleration in the services sector, Q1 GDP growth beat both the initial flash estimate of 2.1 per cent growth, and the market's expectation that this could be raised slightly to 2.2 per cent. It was also faster than the 2.1 per cent growth in the preceding quarter.

The main drivers of Q1's expansion were the finance & insurance, wholesale & retail trade, and business services sectors, which grew 7.9 per cent, 4.1 per cent, and 2.8 per cent respectively. Together, they accounted for 79 per cent of GDP growth, and boosted services' expansion to 3.8 per cent from Q4 2014's 3.1 per cent.