By Xinghui Kok and Jun Yuan Yong
SINGAPORE (Reuters) -Singapore’s economic growth is likely to slow in the second half of the year despite a better-than-expected performance in the first half because of uncertainties over tariffs, the head of its central bank said on Tuesday.
Monetary Authority of Singapore (MAS) managing director Chia Der Jiun, speaking during the release of the central bank’s annual report, said this was in line with the central bank’s expectations of slower global economic activity and weaker external demand.
Chia said there was considerable uncertainty given the range of potential outcomes.
“There is a range of possibilities around the extent and scope of tariffs, whether trade agreements are concluded and prove to be durable, and whether escalating trade conflicts recur,” he said.
On Monday, the city-state reported preliminary growth of 4.3% for the second quarter compared to a year earlier, pegged to the front-loading of exports during a pause in U.S. tariffs.
The trade ministry in April downgraded the city-state’s GDP forecast for 2025 to a range of 0% to 2%, down from 1% to 3%.
“Consumption and investment will likely soften in the months ahead,” said Chia.
U.S. President Donald Trump last week notified more than 20 countries of tariff rates of 20% to 50% that will kick in from August 1, warning that any reprisals would draw a like-for-like response.
Singapore has not yet received a letter from the Trump administration this round and its exports are still subject to the 10% baseline tariff announced in April.
Chia told the media briefing that the MAS made a net profit of S$19.7 billion ($15.38 billion) in the 2024/25 financial year.
Assets under management in Singapore grew 12.2% year-on-year to exceed S$6 trillion for the first time.
“Singapore continues to be a trusted and attractive wealth management centre underpinned by high standards of regulation,” said Chia.
The MAS this month gave penalties of $21.5 million to nine financial institutions, including Citibank, Julius Baer and UBS, for their role in the 2023 S$3 billion money laundering case.
“Our financial eco-system will be tough on suspicious and illegitimate monies, but welcoming and efficient to legitimate wealth,” Chia said.
($1 = 1.2811 Singapore dollars)
(Reporting by Xinghui Kok and Jun Yuan Yong; Editing by David Stanway )
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