After a false start in 2021, economic reopening is deemed inevitable as Singapore becomes better equipped in dealing with the Covid-19 pandemic. We view the surge in Omicron cases as a temporary setback to the eventual reopening of the economy.
In 2022, we also expect quantitative tightening to be on the agenda as the US central bank begins shrinking its balance sheet and raising rates. The Singapore Government is also moving ahead with a planned goods and service tax (GST) hike this year. We discuss whether this will lead to consumption spending stalling.
Omicron speed bump