Singapore’s economy finished 2025 on a stronger footing than expected, prompting authorities to lift 2026 growth and export forecasts.
Summary:
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Singapore’s economy grew faster than expected in Q4, beating official advance estimates on both annual and quarterly measures.
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Full-year 2025 growth was revised higher, confirming strong momentum into year-end.
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Authorities upgraded the 2026 GDP growth outlook, citing firmer global demand conditions.
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Manufacturing and trade-related services are seen as key beneficiaries of the improved outlook.
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Export prospects have also brightened, supported by AI-related demand and elevated gold prices, though risks remain.
Singapore’s economy ended 2025 with stronger-than-expected momentum, reinforcing confidence in the near-term outlook and prompting an upgrade to official growth forecasts for the year ahead.
Final data showed gross domestic product expanded 6.9% year-on-year in the fourth quarter, comfortably above the advance estimate and underscoring resilient activity across key sectors. On a seasonally adjusted quarter-on-quarter basis, output rose 2.1%, also exceeding preliminary figures and pointing to solid underlying growth heading into 2026.
For the full year, economic growth was confirmed at 5.0%, slightly higher than earlier estimates and marking a firm acceleration from the prior year. Analysts say the outturn reflects stronger global demand late in the year, alongside improved performance in trade-sensitive segments of the economy.
Against that backdrop, the Singapore Ministry of Trade and Industry raised its 2026 GDP growth forecast to a range of 2.0% to 4.0%, from a previous 1.0% to 3.0%. Officials pointed to stronger-than-anticipated global momentum in the fourth quarter, which is expected to carry into the early part of this year.
The ministry also highlighted an improving outlook for Singapore’s manufacturing and trade-related services sectors, noting that conditions have strengthened since its last assessment. Analysts see this as a reflection of stabilising electronics demand, firmer regional trade flows and continued resilience in higher-value-added manufacturing.
Export prospects have similarly improved. Enterprise Singapore upgraded its 2026 forecast for non-oil domestic exports growth to 2.0% to 4.0%, from a prior range of 0% to 2.0%. Analysts attribute the brighter outlook to robust demand linked to artificial intelligence-related investment and persistently high gold prices, which support Singapore’s key export categories.
However, risks remain tilted to the downside. Authorities and analysts alike caution that a renewed escalation in global trade tensions or a sharp correction in AI-related investment demand could dampen export performance later in the year. Even so, the combination of solid recent growth, improved global conditions and targeted sectoral support suggests Singapore enters 2026 with a firmer economic foundation than previously expected.
This article was written by Eamonn Sheridan at investinglive.com.