Before we can form a meaningful outlook of the Singapore investment market for 2023, Let’s describe the Singapore economy and its characteristics, and current trends for 2022. Then we will try to make educated conclusions and guesses about its 2023 possible trends and how traders and inventors can act to maximize their profits.
Before we start, this article isn’t a call to action to buy or sell anything, nor is it financial advice. No one has the magic ball and any prediction can be proven wrong in the sight of complex socio-economic events.
Singapore, as an attractive investment market
Singapore is a highly developed free-market economy. The world economic forum has classified Singapore’s economy as the most open, the third least corrupt, and the most pro-business in the world. Low tax rates paired with the second-highest per-capita GDP in terms of PPP (purchasing power parity) make Singapore almost a haven for wealth management firms and assures that companies can operate under fair laws. Traders can make good money when trading developed countries trading instruments. For traders, it is important to see and act upon trading opportunities in well-developed economies. This investfox leaderboard of best FX brokers will help you choose from some top brokers. The information collected above is enough to consider investing in Singapore-based firms. Foreign investors love low-risk investment countries. Lower risks make potential returns a bit lower but it is better to have a steady yearly 5% return on investment rather than risking hard-earned money on lowly developed countries’ fragile and obscure economies. Singapore’s investment market is definitely one of the best in the world. Definitely in the top 5.
Analysis of Singapore investment markets in 2022
We have listed the most important macroeconomic and political factors which make Singapore a very attractive country for investors. Let’s dig deeper into some technical and fundamental data. Strait Times Index or STi is another important factor to consider when analyzing Singapore’s economic outlook. We will analyze the STI below and use it in determining possible trends for 2023. Going on next, inflation is one of the most important economic indicators to consider before even thinking about investing anywhere. It determines if the annual return is enough to make profits. If inflation is 7% then invested money has to make at least 7% yearly not to lose value. Inflation rates will determine how much of a challenge it will be in 2023. For this, let’s look at Singapore’s inflation rates and forecasts. The inflation isn’t higher than in any other country with 7.8% and core inflation sitting at 4.8% it’s around USA’s levels. This shows how much power Singapore holds in its economy.
What are the best indicators to catch the current investment market status? There are a few to name. The Straits Times Index or STI is a stock market index for Singapore that tracks the top 30 companies which are listed on Singapore Exchange. Looking at STI charts for 2022 will tell us current trends and tendencies and will provide a good ground for future predictions. As we can see on the chart below, Singapore’s stock market was in a sideways market and a nice double top correctly predicted price going down after a 2021 post-covid recovery. Currently, it is a sideways market.
Singapore investment market 2023
According to STI daily charts the market will try to test $3300 price levels and if it succeeds further rise in price is likely, but if we look closer it seems like the market already failed to break out of this level. We could see nice bearish momentum forming here. Traders should check the STIs chart daily not to miss something important. If we capitalize on the Ministry of Trade and Industry Singapore (MTI) the GDP growth is projected at 3.5% in 2022 and 0.5 to 2.5% in 2023. This indicates that compared to 2022 the 2023 investment market could be in bear territory. Add to this our technical analysis of STIs from earlier and the chance of STIs going down is higher for 2023 than it was for 2022. The inflation forecast for 2023 is about the same as 2022 at 4-4.5%. This further strengthens the conclusion that the bearish market could continue. Overall it is going to be a bear market in 2023 for the Singapore investment market, at least for the first half of the year it is highly probable that we see some major downtrends in the global economy.