Regional slowdown hits Singapore hard

Regional slowdown hits Singapore hard

SINGAPORE (Reuters): April data released on Saturday by the Monetary Authority of Singapore (MAS) showed the regional slowdown hitting Singapore hard in a number of sectors.

The MAS said the rate of growth in bank lending to most major sectors of the economy fell year-on-year, and month-on-month total loans showed a slight decline.

The commerce sector had negative year-on-year growth of 1.8 percent, having already contracted every month since the beginning of 1998.

"With the commerce sector in recession, bank lending to this sector is not likely to pick up in the near term," the MAS said.

The property market was an exception, with credit extended to the building and construction sector relatively strong at 12.4 percent year-on-year growth.

In contrast, manufacturing showed year-on-year growth of just 2.3 percent, down from 4.1 percent in March.

Narrow M1 money supply contracted by 4.5 percent in April year-on-year after shrinking an average of 5.3 percent in the first quarter of 1998.

Part of the M1 decline reflected higher interest rates which "raised the opportunity cost of holding cash balances or their equivalent", MAS said.