Economists surveyed by the Monetary Authority of Singapore (MAS) on Wednesday downgraded the the gross domestic product forecast for this year and the next, while inflation is projected to be higher than previously expected.

The quarterly survey of Professional Forecasters showed that economists now expects the GDP to rise 2.4 percent this year, slower than the 3 percent growth predicted in the June survey. The GDP outlook for 2013 was also cut to 3.9 percent from the previous prediction of 4.5 percent.

The manufacturing sector is expected to grow 2.7 percent this year, slower than the June prediction of 3 percent growth. Non-oil domestic exports are seen growing 4.2 percent compared to the previous prediction of 5.6 percent. The outlook for private consumption was also cut to 3 percent from 3.7 percent.

For the third quarter of 2012, the respondents expect GDP to expand 2.3 percent following 2 percent growth in the second quarter. This is a downgrade from the 3.3 percent reported in the earlier survey.

Forecasters now see the consumer price index rising 4.4 percent this year, up from 4.2 percent in the June survey. The outlook for core inflation was lowered to 2.5 percent from 2.7 percent predicted three months ago.

The CPI and MAS core inflation are forecast to be 3.2 percent and 2.2 percent respectively in 2013.

As for the labour market, the respondents expect the unemployment rate to be 2.1 percent by end-2012, marginally lower than the 2.2 percent from the previous survey.

RTTNews