The biggest worry for Singapore isn’t Asian inflation, rather, slowing growth infecting their economy and focused exchange traded funds (ETFs) due to the general malaise of the U.S.

Singapore’s economy contracted during the second quarter, and the government is calling for a fall in exports for the first time since 2001. The economy contracted at a general rate of 6% during the second  quarter,  giving the year-on-year economy a growth rate of a mere 2.1%, reports Reuters.

It is evident that the sluggish U.S. economy has hurt the Asian economies, such as Singapore. Non-oil exports to the U.S. fell 21% in the second quarter and dropped 12% to the E.U.  Weakened demand in the major economies, has added to inflationary pressures.  A turn around for the country could be dependent upon the U.S.’ economic health

ETFs associated with Singapore include:

  • iShares MSCI Singapore (EWS), A heavy lean toward the financial sector at 51.43% followed by telecommunications at 14.3%; down 14.4% year-to-date
  • NETS FTSE Singapore Straits Times Index (SGT), 48% in financials, 12.43% in telecommunications; down 13.4% for past three months

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.