Singapore’s policy makers need to be watchful of escalating prices and overheating risks in the economy after last year’s “exceptional” expansion, Senior Minister of State for Trade and Industry S. Iswaran said.

“There is no need for stimulus measures” even as growth slows this year, Iswaran told parliament in Singapore today. “If anything, we need to be watchful of overheating risks and rising inflationary pressures as the labor market tightens and capacity constraints become more binding.”

 

Singapore’s rebound last year from a 2009 global recession has fueled inflation, prompting the central bank to allow faster currency gains and leading the government to implement measures to cool the property market. 

 

Gross domestic product rose 14.7% in 2010, an expansion that probably made the city of 5 million people the fastest-growing economy in the world after Qatar, according to International Monetary Fund estimates.

 

“Amidst still strong growth, a high level of GDP and tight resource utilization, inflation pressures will likely be the single biggest concern for policy makers in 2011,” said Kit Wei Zheng, a Singapore-based economist at Citigroup Inc. The likelihood of further policy tightening by the central bank in 2011 “remains high,” he said.