The Week In Numbers: Recession – What Recession?

Singapore just managed to avoid recession by the skin of its teeth. The economy grew 0.1% in the third quarter, which was all that was required to side-step two successive quarters of economic shrinkage. The best performing sector was services, which grew 0.8%. Manufacturing fared badly, though.

The quarterly growth caught many economists on the hop, with 16 out of 25 number crunchers expecting the Monetary Authority of Singapore to ease the Singapore dollar. As it turned out, it didn’t.

The central bank said the local currency would continue to appreciate, albeit more slowly. Immediately following the news, the Singapore dollar jump 1% against the US dollar. But experts think the rally could be short lived. How do they know that, when they got the GDP numbers so wrong?

China said it exported less and imported even fewer goods. That set alarm bells ringing. The world’s second-largest economy said exports fell 3.7% in September but it was the 20.4% slide in imports that could indicate a slowdown in consumer demand. The so-called “commodities currencies” such as the Australian and Canadian dollar dropped on the news.

The Straits Times Index (SGX: ^STI) climbed back above 3,000 points this week. The index of Singapore’s 30 largest companies is valued at around 13 times historic earnings. It means that we could earn $8 for every $100 invested in those companies, if they should pay out all their profits as dividends. It’s hard to think of another investment that could do that!

And finally, mergers and acquisitions are back with a vengeance. A deal has been struck between Belgium’s Anheuser-Busch InBev and the UK’s SABMiller. The merger, which is worth a colossal US$100b, could see the creation of the world’s largest brewer. Whilst the merger might seem straightforward enough, the choice of a new name for the new company could be a bigger headache – ABIBSAB just doesn’t quite roll off the tongue.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.