Singapore economy may expand 6.2% this year, MAS survey shows

Singapore’s economy may expand faster than previously estimated in 2011, fueling inflation and spurring a larger appreciation in the currency, a central bank survey of economists showed.

Gross domestic product may increase 6.2% this year after growing 14.5% in 2010, according to the median estimate of 21 economists in a survey by the Monetary Authority of Singapore released today. The economists predicted 2011 growth of 5.7% in last quarter’s poll.

Asian policy makers from China to Thailand and India have raised interest rates or allowed their currencies to gain to curb price pressures after the region rebounded from the 2009 global recession. Singapore’s central bank said in April it would allow further currency appreciation in its third tightening of monetary policy in a year, a move that has pushed the local dollar to a record.

 

“The government has moved to tame inflationary pressures that it can directly control or have a strong influence over” even as the battle against inflation is far from finished, Kit Wei Zheng, a Singapore-based economist at Citigroup Inc., said in a report yesterday. “It appears too early to completely rule out further MAS tightening in October, even if the bar is higher for further tightening.”

 

The government expects growth of as much as 7% in 2011. The Southeast Asian island’s economy will probably expand 2% this quarter from a year earlier, the MAS survey showed. GDP rose 8.3% in the three months through March from a year earlier.