We maintain a 2025 growth forecast of 2.5%, but have cut 2026 expectations from 1.5% to 1.2% due to weaker growth in the US and Mainland China.
Key View
- We maintain our 2025 growth forecast at 2.5%, with exports set to fall sharply after the boost from front loading fades.
- We have revised down our 2026 growth forecast from 1.5% to 1.2%, reflecting weaker growth prospects in both the US and Mainland China than we expected at the start of 2025.
We maintain our 2025 growth forecast at 2.5%. Revised GDP data showed that growth picked up from 4.1% in Q1 to 4.4% in Q2, slightly above the advance estimate of 4.3%. This brought H1 growth to 4.3% y-o-y, but the outlook for the rest of the year appears less robust.
Singapore’s economic outlook for 2026 has seen a downward revision, reflecting a more cautious stance amidst global uncertainties. The Ministry of Trade and Industry (MTI) recently adjusted its growth forecast, anticipating a more moderate expansion compared to previous projections. This adjustment is influenced by a complex interplay of factors, including slower-than-expected recovery from global supply chain disruptions and ongoing geopolitical tensions.
The revised forecast highlights challenges facing key sectors, such as manufacturing and trade. As global demand fluctuates, Singapore’s export-driven economy may experience additional pressures. Analysts suggest that these conditions could hinder the anticipated growth momentum previously expected for 2026, prompting a reassessment of strategies within the business community and government policy makers alike.
In response to this revised outlook, stakeholders are urged to adopt a proactive approach. Investment in technology and workforce development could provide necessary enhancements to productivity. Singapore’s commitment to innovation and sustainable growth remains critical for navigating these challenges, aiming to secure economic resilience in the face of an evolving global landscape.
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