In the past 12 months, Singapore has emerged from the brink of recession as a leader in economic growth in developed countries, but it is based on the explosive growth of output in the country's semiconductor industry.
Although it is widely expected that the Bank of Singapore will tighten its policy by appreciating the yuan at the end of next year, the economic recovery is not based on a broad enough basis and some analysts question whether Singapore is prepared.
'The problem is that there is not a lot of workers hired in well-performing industries ... so the benefits of diffusion to other parts of the economy are quite limited,' said Brian Tan, an Nomura analyst in Singapore.
Unlike most analysts, Tan is not too sure the Monetary Authority of Singapore will tighten policy next year.
Tan estimates that the semiconductor industry employs only about 1% of the workforce, but contributed nearly half of the increase to the economy in the third quarter. Figures released last week showed that the final value of gross domestic product (GDP) for the third quarter of Singapore An increase of 5.2% over the same period of last year.
This is three times Japan's growth over the same period and more than double the growth rates in the United States and the Eurozone.
According to a October Reuters survey, more than two-thirds of respondents said they expect the HKMA to tighten policy next year by allowing the yuan to appreciate.
Singapore is one of the few countries that uses currency to manage its monetary policy.
The acceleration of the global economy may also prompt the HKMA to tighten policy as South Korea became the first major Asian country to raise interest rates this year in a trade-dependent economy.
The government of Singapore has so far held a very conservative view on economic growth next year. It is expected to grow at a rate of 1.5-3.5% and its forecast for economic growth in 2017 will be revised up to 3-3.5%.
When asked about the economic outlook a week ago after the publication of the economic growth data, the HKMA simply said that the policy position announced in October is still suitable. The HKMA maintained its policy unchanged at the policy meeting in October but fine-tuned its forward-looking guidance.
**unbalanced**
Those who think the policy will not be adjusted next year believe that the semiconductor industry outlook and trends are inconsistent and will be short-lived, here refers to the weak performance of other industries.
For example, the construction industry has shrunk from the same period of last year for five consecutive quarters.
Analysts said the steady growth of 3% in the service sector is a better indicator of Singapore's long-term economic conditions.
Other economic indicators remain fragile.
In the job market, the number of job seekers exceeds the number of job openings, and wage growth has slowed from a year ago, with core inflation of 1.5% and below the historical average.
"I think they (HKMA) may not be able to hold their hands in 2018," said Andy Ji, strategist at Commonwealth Bank of Australia (CBA) and said inflationary pressures have moderated and economic growth may peak in 2018.
CK Tan, of the Semiconductor Industry Association of Singapore, told Reuters that the biggest driver of Singapore's manufacturing boom may also weaken in the second quarter of next year.
'This market is purely consumer-driven and manufacturing output traditionally has to be higher in this period, purely because of the holiday shopping season,' said Tan.
Tan said traditionally this kind of kinetic energy will slow down in the second quarter because the industry will invent inventory after the holiday shopping season and the cardinal effect of the data will also be weakened because the industry has been growing rapidly since the end of 2016 .
This slowdown will coincide with the first half-yearly meeting of the Monetary Authority of Singapore in April.