Economists raise Singapore’s 2026 growth forecast to 5% on AI boom: MAS survey
Respondents also raised their predictions for manufacturing and non-oil domestic exports.
Singapore's private-sector economists have revised their 2026 growth forecast up to 5 percent, compared to an earlier projection of 3.5 percent. This optimistic assessment is attributed to a surge in exports and manufacturing output during the first half of the year. The Monetary Authority of Singapore (MAS) surveyed professional forecasters on September 2, following the Ministry of Trade and Industry's August 11 upgrade of its GDP growth forecast to between 4.5 percent and 5.5 percent.
Enterprise Singapore also boosted its non-oil domestic exports forecast for 2026 from 3 to 5 percent to a range of 14 to 16 percent, reflecting a strong first-half performance in electronics. The MAS survey revealed that manufacturing and non-oil domestic exports (NODX) growth projections were significantly revised upward, from 5 percent and 6.1 percent to 8.4 percent and 17 percent respectively, due to the strong demand for AI-related electronic hardware.
This growth momentum could potentially lift GDP growth even further. Economists identified a sustained AI-driven upturn in the technology cycle as a key support for Singapore's economic outlook, which could raise GDP growth even higher. However, the survey also identified downside risks, such as the escalation of the Iran conflict or a potential AI bubble burst, which could negatively impact the economy.
Several sectors, including finance and insurance, construction, and wholesale and retail trade, saw their growth forecasts raised by the economists. The median forecast for all-items inflation for 2026 came in at 2.1 percent, lower than the 2.3 percent in June. The median forecast for core inflation also decreased to 1.9 percent from 2 percent.
The unemployment rate is expected to remain at 2.1 percent at year-end, unchanged from the June 2026 survey. Lastly, 45 percent of the respondents anticipate the Monetary Authority of Singapore (MAS) to tighten monetary policy in October by increasing the slope of the Singapore dollar nominal effective exchange rate policy band.
Written by urgent.news from Straits Times Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
