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The Week in Numbers: Australia’s Economy Expands in the Third Quarter

Australia’s gross domestic product grew by 0.6% last quarter. This was mainly due to an uptick in business investments. Private investments jumped 4.5%, the biggest increase since 2013. Consequently, the annual pace of growth rose to 2.8% from 1.9% last quarter. On the downside, household expenditure, which accounts for 55% of Australia’s S$1.74 trillion economy, increased by just 0.1%, its smallest increase in more than four years.

According to an Economic Intelligence Unit (EIU) report, Singapore has overtaken the United States as the investment destination of choice for the Chinese. Australia came in third, while our neighbour, Malaysia, was in the 21st spot. According to China’s commerce ministry, Chinese non-financial overseas direct investments into belt and road countries contracted by 2% in 2016 to US$14.5 billion. Foreign overseas direct investments to these countries also fell by 13.7% during the first three quarters of this year.

Back home, Singapore’s manufacturing Purchasing Managers’ Index (PMI) grew to 52.9 in November, an improvement from 52.6 in October. November was also the 15th continuous month of growth in manufacturing and also the strongest growth in eight years. Manufacturing makes up around 20% of the economy and is expected to contribute to growth in 2018.

Meanwhile, the UK’s manufacturing PMI came in at 58.2 in November, an improvement from 56.6 in October. This is its fastest growth in four years. Manufacturing is expected to be the bright spot for the British next year, who expect the economy to slow down as Brexit looms. The strong showing this month was due to increase in home orders and from Europe’s improving economy.

Singapore’s population demographic is also set to achieve an unwanted landmark. According to research, for the first time next year, the number of people aged 65 and older in Singapore will equal those 15 years and younger. As the elderly population increases, there will be an inevitable need to change tax laws, immigration rules and social services. At current rates, Singapore seniors aged 65 and up will make up more than double those 15 and under by 2030, a scary prospect which can have detrimental effects on the economy.

Finally, if you thought that real estate in Singapore was expensive, well think again. Some of the world’s most expensive real estate actually floats on the ocean. For example, apartments on The World, a condo cruise ship that has 165 apartments cost around US$4,285 to $6,200 per square foot. That is more expensive than Monaco’s (the world’s priciest market) average price of $5,420 per square foot. On top of that, residents have to pay up to $900,000 a year in annual maintenance fees.

However, you do get to enjoy the amenities on board, which also includes a 16,000-bottle collection of wine, two pools and a 7,000-square-foot spa. The ship is in port or at sea 365 days a year, only returning to dry-dock once every 3 years for repairs. This year, it would have visited more than 100 ports of call in more than 20 countries and would have completed a 44-000 nautical mile course.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.