SINGAPORE - Singapore's economy contracted in April-June for the first time in seven quarters, hurt by a sharp drop in manufacturing activity, data showed on Monday.
Singapore's GDP shrank by 0.8 per cent in the second quarter from the previous quarter on a seasonally adjusted and annualised basis, a much weaker outcome than the median forecast of 2.5 per cent growth seen in a Reuters survey.
The last time Singapore's GDP contracted in the seasonally adjusted annualised quarter-on-quarter advance estimates was in the third quarter of 2012, when GDP shrank 3.6 per cent.
The Ministry of Trade and Industry's advance estimates showed gross domestic product (GDP) expanded by 2.1 per cent in the April-June quarter on a year-on-year basis, slowing from a revised 4.7 per cent growth in the first quarter.
That was weaker than the median forecast in a Reuters survey of 3.1 per cent growth.
Breakdowns by sector showed that manufacturing fell 19.4 per cent in the second quarter on a quarter-on-quarter, seasonally adjusted and annualised basis, down sharply from 12.2 per cent growth in the first quarter.
The construction sector grew by 2.6 per cent in the second quarter, while the services sector expanded by 5.2 per cent.
Recent economic indicators have shown signs of weakness in the city-state's economy. Manufacturing output contracted at its worst annual pace in 11 months in May, while non-oil domestic exports unexpectedly fell that month on weak shipments of electronics and pharmaceuticals to key markets.
Many economists had predicted at the start of the year that a recovery in the United States and European economies would boost Singapore's exports, but signs of that demand filtering through have yet to materialise.
The government expects Singapore's economy to grow 2-4 per cent in 2014 after expanding by 3.9 per cent last year, and economists have generally tipped full-year 2014 growth to come in near the upper end of the official forecast.