Slower growth was mainly explained by manufacturing activity, which contracted 0.5 percent after expanding 4.6 percent (vs preliminary 5.1 percent) in the previous quarter. It marks the sector's first decline in three years. Output declines in the precision engineering and electronics clusters due to weak global semiconductor and related equipment demand more than offset output expansions in the biomedical manufacturing, transport engineering and general manufacturing clusters.
Also, wholesale and retail trade shrank significantly by 1.8 percent, after a 0.8 percent decrease in the previous quarter. In contrast, the construction sector bounced back 2.9 percent (vs preliminary 1.4 percent) following a 1.2 percent contraction (vs preliminary 1.0 percent) in the previous three months and marked the first positive figure after 10 consecutive quarters of decline, supported by an improvement in both public sector and private sector construction works.
On a quarter-on-quarter seasonally-adjusted annualised basis, the economy grew 3.8 percent in the three months to March 2019, rebounding from a 0.8 percent contraction in the previous period and beating market consensus of 2.3 percent, final data showed. Growth was led by construction, up 14.0 percent from 5.3 percent in the previous three months and by services which rose at a faster 5.5 percent from 0.4 percent in the prior quarter, driven by wholesale and retail trade (5.9 percent vs -5.0 percent in Q4 2018) and information & communication (8.3 percent vs 7.2 percent).
The Ministry of Trade and Industry (MTI) slashed the upper end of its annual growth forecast and announced that it now expects Singapore's economy to grow "1.5% to 2.5%" in 2019 from the previous projection of "1.5% to 3.5%", after "taking into account the performance of the economy in the first quarter, as well as the weaker external demand outlook". In particular, global growth outlook for 2019 remains "clouded by uncertainties and downside risks", including trade tensions between the US and China, subdued growth in China and the delay in Brexit until October 31th 2019.
The base year for the GDP data was changed to 2015 from 2010 to better reflect changes in the economy. As such, GDP growth for 2018 was revised down to 3.1% from 3.2%.