Singapore Growth Forecast Raised Amid AI Boom

SINGAPORE, Aug 14, 2026 – Singapore’s economy is set to expand faster than previously expected, with the Ministry of Trade and Industry (MTI) raising its 2026 growth forecast to 4.5%–5.5%, up from 2%–4%. Investment bank Nomura projects an even stronger 5.7% growth, above the government’s revised range and consensus estimates.

The upgrade follows stronger‑than‑expected second‑quarter GDP data, with growth revised up to 5.9% year‑on‑year (YoY) from 5.7%, after a 6.3% surge in Q1. Sequential growth also improved to 1.4% quarter‑on‑quarter. Gains were broad‑based, led by manufacturing, which jumped 12.5% YoY, driven by robust AI‑related demand. Services also strengthened, with finance and insurance rising 6.2% and wholesale trade holding at 8.3%.

AI Boom

MTI said the global AI investment boom has lifted growth more than expected, while the impact of the Iran war has been less severe. Nomura highlighted new capacity such as Micron’s S$9.5 billion high‑bandwidth memory plant as a key driver.

On inflation, Nomura maintained its 2026 core forecast at 2.1% but expects it to rise to nearly 3% by September, citing elevated energy prices and tariff adjustments. The Monetary Authority of Singapore (MAS) is expected to remain vigilant against inflation risks.

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