The Monetary Authority of Singapore (MAS) has forecasted a significant slowdown in Singapore’s economic growth for 2025, projecting a range of 0.0% to 2.0%.
This comes as part of the April 2025 Macroeconomic Review, which also anticipates a global GDP growth reduction to 2.0-2.5%, down from 3.2% in 2024. The slowdown is attributed to the impact of higher US import tariffs affecting both domestic and international markets.
The review highlights a slight increase in global headline inflation, now estimated at 2.3% for 2025, up from 2.1% in 2024. This adjustment is largely due to tariff-induced inflation in the US, although offset by deflationary pressures elsewhere, particularly in China. The average Brent crude oil price forecast has been revised down to $68 per barrel, aligning with current market prices.
MAS maintains its forecast for core and headline inflation in Singapore to average between 0.5% and 1.5% in 2025, with a tendency towards the lower end of this range. Core inflation is expected to average around 0.8% for the year, whilst headline inflation is projected to be slightly higher at 1.0%.
A UOB Macro Note suggests that the economic outlook for Singapore is more negative compared to previous assessments, with the output gap expected to turn negative at -0.5% of potential GDP. This has led to speculation that MAS may adjust its monetary policy stance to a zero percent appreciation, potentially flattening the Singapore dollar nominal effective exchange rate (S$NEER) slope in the upcoming July 2025 Monetary Policy Statement.
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