The Ministry of Trade and Industry (MTI) of Singapore announced on Tuesday, August 11, 2026, that it has raised the country's economic growth forecast for the year to between 4.5% and 5.5%, up from the previous estimate of 2% to 4%. This revision reflects a better-than-expected performance in the first half of 2026 and an improved outlook for the remainder of the year.

Singapore's economy grew by 5.9% in the second quarter of 2026, slightly exceeding the advance estimate of 5.7%, though it eased from the 6.3% growth recorded in the first quarter. On a quarter-on-quarter seasonally adjusted basis, the economy expanded by 1.4%, continuing the 1.2% growth seen in the first quarter. For the first half of the year, GDP increased by 6.1% year-on-year.

MTI attributed the strong Q2 growth to robust performances in the manufacturing, wholesale trade, and finance and insurance sectors. The ministry highlighted that "robust global AI-related demand boosted growth in the electronics and precision engineering clusters of the manufacturing sector, as well as the machinery, equipment and supplies segment of the wholesale trade sector."

Looking ahead, the ministry expects growth for the rest of the year to be supported by an acceleration in global AI-related capital expenditure. Additionally, the outlook has improved due to a less severe-than-feared impact from the Middle East conflict.

However, MTI noted that the Eurozone's economic outlook has weakened due to elevated energy prices, which could lead to further interest rate hikes and dampen domestic demand.

This latest forecast upgrade follows a previous revision in February 2026, when MTI raised the growth forecast from 1%–3% to 2%–4%.

Sources