2Q GDP Jumps on Low Base, Raise 2021 GDP Forecast to +6.8%

Manufacturing-Led Recovery
GDP rebounded in the second quarter from last year’s low base, with the manufacturing sector climbing to the highest level on record. Construction and services are recovering from the circuit breaker lows last year, but remain below pre-pandemic levels partly due to foreign worker shortages and Phase 2 heightened alert measures.

GDP surged by +14.3% in 2Q21 from a year ago (vs. +1.3% in 1Q). On a quarter-on-quarter seasonally adjusted basis, GDP declined by -2% (vs. +3.1% in 1Q), the first decline since 2Q20.

GDP in 2Q21 remained 0.9% below its pre-pandemic level in 2Q19. But comparing the first half of 2021 to the first half of 2019, GDP was 0.2% higher than pre-pandemic levels, as manufacturing strength (+19.3% above pre-pandemic) offset the sluggish recovery in construction (-27.4% below) and services (-3.3%) (see Table 1).