Year-on-year, the manufacturing sector contracted by 1.1 percent, following a 1.4 percent expansion in the previous three months. The sector was primarily weighed down by a decline in the output of transport engineering, biomedical manufacturing and general manufacturing clusters.
The services producing industries shrank 0.1 percent, compared to a 1.2 percent growth in the June quarter, largely due to the wholesale & retail trade segment.
Growth in the construction sector came in at 2.5 percent, compared to a 2.6 percent increase in the second quarter. The slowdown was due to a sharper decline in private sector construction activities.
On a quarter-on-quarter seasonally-adjusted annualized basis, the economy unexpectedly contracted by 4.1 percent, following a downwardly revised 0.2 percent expansion in the June quarter while market expected a 0.3 percent growth. It was the first contraction since the second quarter 2015 and the sharpest since the September quarter 2012. A decline was seen in the manufacturing sector (-17.4 percent from a 2.1 percent growth in the June quarter) and the services sector (-1.9 percent from a 0.9 percent contraction). In contrast, construction sector grew by 0.5 percent, following a 1.1 percent growth in the preceding quarter.
Meanwhile, against the backdrop of a less favourable external environment, Singapore’s trade-related sectors will continue to pose a drag on GDP growth in the quarters ahead, the Monetary Authority of Singapore (MAS) said on its website. Growth in the economy is projected to take a step-down in the second half of 2016 from the 2.0 percent recorded in the first half. Full-year GDP growth is likely to come in at the lower end of the 1–2 percent forecast range. Growth is expected to be only slightly higher in 2017.