Economy slows to 5.4% in Q3 despite electronics expansion

Manufacturing rose 7.5% year on year against 12.9% in Q2.

Singapore’s gross domestic product grew by 5.4% year on year (YoY) in the third quarter (Q3), moderating from 6.2% growth in Q2, the Ministry of Energy, Trade, and Industry (METI) reported.

On a quarter-on-quarter seasonally-adjusted basis, the economy expanded by 1.1%, easing from the 1.5% growth in Q2.

METI attributed the growth to output expansions in the electronics, precision engineering, transport engineering, and general manufacturing clusters, which outweighed output declines in the chemicals and biomedical manufacturing clusters.

The manufacturing sector grew by 7.5% YoY in Q3, down from 12.9% in Q2, whilst the construction sector expanded by 8.8% YoY, up from 6.1%, as both public and private sector construction output increased.

The wholesale and retail trade, and transportation and storage sectors collectively grew 8.0% in Q3, up from 6.9% in Q2, with retail trade lagging as the sectors expanded.

Wholesale growth was driven by machinery, equipment, and supplies, alongside strong electronics exports, whilst water and air transport supported growth in transportation and storage.

The information and communications, finance and insurance, and professional services sectors grew 4.3%, easing from 5.1% in Q2, with all sectors recording growth.

IT and information services drove growth in the information and communications sector, whilst architectural and engineering services, technical testing, and analysis services supported the professional services sector.

Meanwhile, growth in the finance and insurance sector was led by the fund management and banking services segments.

Growth in accommodation and food services, real estate, administrative and support services, and other services industries came in at 2.1%, extending the 2.4% growth in Q2.

The food and beverage services sector was the only sector within the group that lagged in Q3, whilst all other sectors expanded.