Singapore’s CPI inflation and industrial output likely declined in March

Singapore is set to release its CPI inflation and industrial output data for March next week. The data will give an idea if the Q1 GDP forecast will be downwardly revised, noted DBS Bank. For the past 16 months, Singapore has recorded negative CPI inflation. It is likely to decelerate 0.4% y/y in March, added DBS Bank.

Decline in oil prices is mainly responsible for the low inflation; however, inflation is also being affected by deceleration in economic growth rate and effect of earlier macro-prudential measures on car and housing purchases, according to DBS Bank.

Meanwhile, the industrial production figures are expected to strongly influence the GDP data for Q1 2016. The Singaporean economy is likely to record a flat growth q/q and expand 1.8% y/y in the first quarter, said DBS Bank.

Nevertheless, the manufacturing sector is expected to have grown strongly by 18.2% q/q and 2% y/y, according to advance estimates. Industrial output is expected to have dropped 1.5%. Growth below this level will suggest revising the manufacturing growth downwards for Q1 2016 and probably also for the total economic growth, noted DBS Bank.