Singapore to unveil ‘expansionary’ budget: analysts

It is expected to shift to a fiscal deficit of 0.3% of its GDP.

Singapore is likely to unveil an ‘expansionary’ budget ahead of the elections, analysts said.

“We expect the budget to unveil targeted measures to further alleviate cost of living pressures, especially for the more vulnerable households and businesses,” said Euben Paracuelles and Charnon Boonnuch, research analysts for Nomura, in a February 2025 report.

Singapore is expected to shift to a fiscal deficit of 0.3% of its GDP, a reverse of Nomura’s earlier estimate of a 0.3% surplus.

Elections are likely to be called in May, on track after the Electoral Boundaries Review Committee was formed in January, Paracuelles and Boonnuch estimates.

Meanwhile, Singapore’s GDP is expected to grow 2.8% year-on-year (YoY) in 2025, moderating from the 4% growth in 2024, on the back of weaker external demand under Trump 2.0.

“That said, we think growth will remain resilient and above potential, as strong local wage and employment growth provide some cushion against shocks from increased trade protectionism,” the analysts said.

Core inflation is forecasted to fall at 1.4%, a lower estimate than Nomura’s earlier 1.6% forecast.

The Monetary Authority of Singapore (MAS) is expected to ease its FX policy again in April, they added.

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