Singapore Cuts 2025 Growth Forecast to 0%-2% as Trade Tensions Escalate

The Monetary Authority of Singapore eases monetary policy for the second time this year to mitigate the impact of US tariffs and a slowing global economy.

The Ministry of Trade and Industry downgraded Singapore's 2025 GDP growth forecast to 0%-2%, citing weakened external demand due to US-China trade tensions.
The Monetary Authority of Singapore reduced the rate of appreciation of the Singapore dollar's nominal effective exchange rate to support growth and stabilize inflation.
Core inflation expectations for 2025 were revised down to 0.5%-1.5%, reflecting easing price pressures and subdued consumer demand.
Key sectors such as manufacturing, wholesale trade, and transport are expected to face significant challenges, with risks of job losses and reduced wage growth.
Analysts remain divided on the likelihood of a technical recession, as Singapore experiences its first quarter-on-quarter economic contraction of 0.8% in early 2025.