Singapore central bank chief says ‘early indications’ Zika could have small economic impact

SINGAPORE Singapore’s central bank chief said on Tuesday there were early indications that an outbreak of the Zika virus in the city state could have a small impact on the economy.

Ravi Menon, managing director of the Monetary Authority of Singapore, did not give any details. He also said it was too early to asses the impact of the virus on Singapore, an international financial and transit hub.

“It’s too early to tell. I would say early indications are there could be some small impact, but it’s not likely to be significant from an overall economy outcome,” Menon told reporters when asked about Zika’s impact on the economy.

“But really, it’s still early days,” he said at the Foreign Correspondents Association in Singapore on Tuesday.

Singapore has so far reported more than 250 cases of Zika, a mosquito-borne virus that has been linked to severe birth defects if pregnant women become infected.

The outbreak of Zika in the small, tropical nation coincides with a dip in economic growth. It also comes nearly two weeks before Singapore is due to host the Formula One motor-racing Grand Prix, a major sporting and tourist draw.

Singapore last month narrowed its economic growth forecast to 1-2 percent from a 1-3 percent growth range previously expected, citing concerns over Brexit and weakening global demand. China, trade-dependent Singapore’s top overseas market, is also experiencing lower economic growth.

In a research note, economists at OCBC bank said the Zika outbreak could have a “near-term anticipated effects on visitor arrivals and possibly even domestic consumption” in September.

(Reporting by Marius Zaharia, Anshuman Daga and Saeed Azhar; Editing by Miral Fahmy and Kim Coghill)