Last quarter the economy in Singapore expanded more than predicted by economists and pundits, with the currency rising in conjunction.
According to Bloomberg, the gross domestic product rose in Q4 of 2012, up by 3.3% from Q2. The predicted growth was set to expand by only 1.8%.
Additional recovery in China and the United States has led to further growth in Malaysia and Thailand. Along with Singapore, the region of South-East Asia is seeing a vast improvement over last year.
But all is not in the clear for Singapore, which is dealing with a stringent labor market and staggering inflation.
Price gains have remained elevated even after the central bank tightened monetary policy last year by allowing its currency to appreciate, as private property prices reached a record and the cost of owning a vehicle surged. Inflation averaged 4.6 percent last year and prices are forecast by the central bank to rise 3.5 percent to 4.5 percent in 2013.
Finance Minister Tharman Shanmugaratnam will present the nation’s annual budget to Parliament on Feb. 25 where he may announce more measures to reduce the country’s reliance on overseas labor while providing incentives to businesses to boost productivity, economists at Citigroup and Oversea-Chinese Banking Corp. said.