Singapore's gross domestic product expanded 2.6 percent on year in the first quarter of 2015, the Ministry of Trade and Industry said in Tuesday's revision.

That's up from the April 14 preliminary reading that called for an increase of 2.1 percent, which would have been unchanged from the previous three months.

Seasonally adjusted and on an annualized quarterly basis, GDP added 3.2 percent - up sharply from the preliminary reading of 1.1 percent but still down from 4.9 percent in the three months prior.

Upon the release of the data, the MTI said it expects the Singapore economy to grow at between 2 and 4 percent in 2015.

The manufacturing sector contracted 2.7 percent on year, extending the 1.3 percent decline in the previous quarter. This was primarily due to the decline in the output of the transport engineering, electronics and biomedical manufacturing clusters. On a quarterly basis, the sector expanded 0.2 percent, a reversal from the 2.5 percent contraction in the previous quarter.

Growth in the construction sector improved to 3.1 percent on year, from 0.7 percent in the previous quarter, supported by a pick-up in private sector construction activities. On quarter, the sector grew at an annualized rate of 12.9 percent, faster than the 2.2 percent growth in the preceding quarter.

The wholesale and retail trade sector grew 4.1 percent on year, faster than the 0.6 percent growth in the last quarter. Growth was supported by the wholesale trade segment, which expanded on the back of improvements in non-oil re-exports. On quarter, the sector's growth accelerated to 15.1 percent, from 0.6 percent in Q4.

The transportation and storage sector rebounded to gain 1.5 percent on year, compared to the 0.4 percent decline in the previous quarter. The improved performance of the sector was due to the water transport segment, which saw an increase in sea cargo handled. On quarter, the sector expanded 6.7 percent, faster than the 0.3 percent growth in the previous quarter.

The accommodation and food services sector turned in a weak performance in the first quarter, contracting 0.4 percent on year, compared to the 1.3 percent growth in the previous quarter. This was largely due to the 6.1 percent decline in visitor arrivals during the same period. On quarter, the sector's growth decelerated from 1.2 percent in the previous quarter to -7.4 percent.

The information and communications sector expanded 4.6 percent on year compared to the 4.4 percent growth in the previous quarter. Growth of the sector was mainly driven by the IT and technology services segment. On quarter, the sector contracted 0.1 percent, following the 5.1 percent growth in the preceding quarter.

The finance and insurance sector expanded 7.9 percent on year, following the 10.3 percent growth in the preceding quarter. Growth was largely underpinned by the banking cluster, which experienced resilient loans growth and higher net interest margins. On quarter, the sector contracted 12.5 percent compared to the 36.2 percent growth in the fourth quarter of last year.

The business services sector grew 2.8 percent on year, similar to the 2.9 percent growth in the previous quarter. Growth was supported by the rental & leasing, other professional, scientific and technical services, and other administrative and support services segments. On quarter, the sector expanded at an annualized rate of 1.4 percent, slower than the 5.9 percent growth in Q4.

The other services industries grew 2.0 percent on year, slower than the 2.4 percent growth in the previous quarter. Growth of the sector was weighed down by the arts, entertainment and recreation segment. On quarter, the sector contracted 0.2 percent, a reversal from the 1.5 percent growth in the previous quarter.