Singapore's inflation should ease towards the end of the year but its economic growth may remain weak for some time, the finance minister was quoted by local mediaas saying on Thursday.
Local TV Channel News Asia quoted Financial Minister Tharman Shanmugaratnam as saying that it would take as much as another year before growth bottoms is reached.
"We have to expect continued weakness in the global economy which might extend into next year and we won't be able to avoid a slowdown if that happens."
"The situation now is different from what it was three months ago. The American economy is in a much more perilous state now and the risks facing the financial system, which is a global system and not just an American system, are still very substantial."
The country still expects growth this year to be between 4 percent and 6 percent. It expanded 7.7 percent last year. But in the second quarter of this year, the economy suffered its biggest contraction in five years with a much-slower-than-expected annual pace of 1.9 percent.
Singapore's annual inflation held at a 26-year high of 7.5 percent in June.
"Food prices have also somewhat leveled off. So our expectation is we should be within our latest inflation forecast of six to seven percent - lower inflation at the end of the year compared to what we saw in the first half of the year," Shanmugaratnam was quoted as saying.
Singapore's Prime Minister Lee Hsien Loong is expected to give an update on growth forecast for the year in his televised National Day message on Friday.
Source: Xinhua
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