IMF predicts Singapore growth slowdown to 2pc

Business | 16 Jul 2019 12:13 pm

The International Monetary Fund sees Singapore’s economic growth slowing to 2 percent in 2019 as global trade tensions hurt external demand.

Growth will probably stabilize in the “medium term” around 2.5 percent, the Washington-based lender said in statement, Bloomberg reports.

In May, the IMF predicted 2.3 percent growth for Singapore in 2019, down from 3.2 percent in 2018.

IMF directors supported “broadly neutral monetary policy stance” and recommended it remain “data-dependent.”

If downside risks materialize, fiscal policy should be the first line of defense, IMF says

Singapore’s financial system is resilient, “underpinned by a strong regulatory and supervisory framework,” it said.

The IMF added that liquidity stress tests reveal vulnerability in U.S. dollar liquidity and IMF directors encouraged giving priority to bolstering banks’ foreign exchange liquidity.

The IMF commended Singapore’s use of macroprudential and other measures in the property market. It suggested “eliminating residency-based differentiation for the Additional Buyer’s Stamp Duty, and then phasing out the measure once systemic risks dissipate.”

In a separate statement, the Monetary Authority of Singapore said it’s reviewing the IMF’s recommendations and will take appropriate steps to strengthen financial oversight.

 

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