Macroeconomic Forecast Singapore

better than expected fiscal performance in FY2007/08 (April-March) has now left the government in a position to provide more help to its citizens than that promised in February's budget speech, meaning that Singapore's overall budget balance is now expected by the government to revert into deficit in FY2008/09. However, despite projections of lower economic growth this year, alongside a cooling in the property market, we view the government's FY08/09 projection for a SGD0.8bn budgetary shortfall as conservative, and are still forecasting a surplus this year, albeit a much smaller 0.9% of GDP (2007 saw the city state record a surplus equal to 2.6% of GDP).

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