The Trade Ministry’s upgrade reflects stronger-than-expected AI-driven demand offsetting Middle East geopolitical risks.
Singapore revised its 2026 GDP growth forecast to 4.5-5.5%, up from a prior range, driven by a sharp rebound in non-oil domestic exports. The Trade Ministry now expects exports to rise 14-16%, a significant jump from the earlier 3-5% projection.
The upgrade follows second-quarter GDP growth of 5.9% year-on-year, exceeding both Reuters poll estimates and the advance estimate. Quarter-on-quarter expansion reached 1.4%, with first-half growth at 6.1%, signaling momentum in trade-exposed sectors.
The shift highlights AI-linked demand outweighing geopolitical risks, particularly from Middle East supply chain disruptions. Markets had recently focused on oil price volatility, but the data underscores an alternative growth driver in the region.