Economy Demonstrating Resilience

BMI View: Singapore's economy continues to surprise on the upside, maintaining its strong momentum despite weakness in the US. We still expect the economy to slow in the final quarter, and anticipate a considerable moderation towards trend growth in 2007, but Singapore has diversified over the past five years, making it less vulnerable to fluctuations in US growth and global electronics demand. This means that although we forecast a sharp slowdown in growth to 4.5% in 2007 from an expected 7.4% in 2006, a collapse below trend is unlikely.

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