Singapore’s GDP is expected to expand by 3.8% y-o-y in 1Q2025, according to the 20 economists and analysts polled in Monetary Authority of Singapore’s (MAS) survey of professional forecasters for March 2025. This comes after the city-state’s economy expanded by 5% y-o-y in 4Q2024, exceeding the respondents’ median forecast of 3.1% in the December 2024 survey.
In the current survey, the respondents also expect Singapore’s GDP to grow by 2.6% in 2025, unchanged from the previous survey. Singapore's GDP this year is expected to be led by the finance & insurance and construction sectors.
Based on the mean probability distribution, the Singapore economy is most likely to grow by 2.5% to 2.9% this year, similar to the previous findings from the December 2024 survey, although the average probability assigned to this range rose to 46% compared to 42% three months ago.
The standard deviation of the forecasts dipped slightly to 0.68 from 0.69 before, while the distribution also became slightly more negatively skewed at -0.55 from -0.4 previously.
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In this survey, the GDP growth distribution for 2025 remained broadly unchanged q-o-q, although it narrowed on a y-o-y basis. GDP growth forecasts at the 75th and 90th percentiles remained largely unchanged from the December 2024 survey but stood lower y-o-y. For instance, respondents on average, placed a 75% probability that Singapore’s GDP Growth in 2025 would be below 2.8% in March 2025, compared to below 3% in the March 2024 survey.
Inflation forecasts
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After CPI-All Items inflation (or headline inflation) and MAS Core Inflation stood below expectations in 4Q2024, market watchers have lowered their headline and core inflation prints for 2025.
In the March 2025 survey, respondents now expect headline inflation to come in at 1.7% this year, down from the 1.9% expectation a quarter ago. MAS core inflation is also tipped to come in at 1.5% at the end of 2025, lower than 1.8% in the previous survey.
This year, headline inflation is most likely to range between 1.5% to 1.9%, where respondents assigned the highest probability of 46% to the range. This stands in contrast to the December 2024 survey where nearly equal probabilities of around 35% were assigned to the forecast ranges of 1.5% to 1.9% and 2.0% to 2.4%.
Respondents also assigned the highest probability to the 1.5% to 1.9% range for core inflation, similar to the previous survey, although the probability assigned to this range fell marginally to 50%.
The standard deviation of headline inflation was broadly unchanged q-o-q although its distribution became less positively skewed. At the same time, the standard deviation for core inflation forecasts increased slightly with its distribution turning from being positively skewed to negatively skewed.
The unemployment rate is expected to be at 2.0% in 2025, down from the December 2024 estimate of 2.1%.
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In this survey, MAS changed its methodology for collecting GDP growth and inflation distribution data. While respondents were asked to assign probabilities to prespecified GDP and consumer price index (CPI) distribution ranges previously, participants were asked to provide five-point estimates for GDP growth and inflation ranging from the lowest to the highest this time. They were also asked to indicate their corresponding probabilities.
“The new methodology seeks to improve the granularity of forecasts collected and reduce anchoring bias associated with pre-set ranges. It also avoids changes to the distribution when the GDP growth and inflation ranges are updated,” says MAS in its latest survey.
“During the transition to the new methodology, respondents were asked to provide GDP growth and inflation forecasts in both the old and new format over the past year. This has enabled analyses of the methodological change on the survey results,” it adds.
Risks to Singapore’s economy
Geopolitical tensions, including higher tariffs, were the most-cited downside risk to Singapore’s economy
Weaker growth in China and a resurgence in inflation were also seen as potential risks.
Meanwhile, more robust growth in China was the most cited upside risk to Singapore’s economic outlook while a sustained tech cycle upturn and milder-than-expected trade tensions were named as other upsides.
Monetary policy
Ahead of the MAS’s April 2025 monetary policy review, a smaller proportion of respondents – 16% – believe that the central bank will reduce the slope of the Singapore dollar nominal effective exchange rate (S$NEER) policy band compared to the previous survey’s responses. However, a larger proportion of respondents – 29% – expect the MAS to reduce the S$NEER slope in July 2025.
At its January MPS, MAS said it would “slightly” reduce the slope of the S$NEER policy band, a first since March 2020. The width of the band or at the level at which it is centred remained unchanged then.
2026 estimates
In 2026, market watchers expect Singapore’s GDP to grow by 2.3%. They expect the country’s economy to most likely grow within the 2.0% to 2.4% range with an average probability of 37%.
Headline and core inflation in 2026 are likely to be at 1.8% and 1.7% respectively, with the highest probability coming in within the range of 1.5% to 1.9%.
All charts and tables: MAS
