Asia’s highest-income country expected to speed up growth to 5% this year

Singapore, Asia's highest-income country, is projected to accelerate growth to 5% this year, according to the Monetary Authority of Singapore (MAS). Most professional forecasters surveyed in August predict no immediate changes to monetary policy, though expectations are shifting toward tightening. Singapore's GDP grew 5.9% in the second quarter, surpassing expectations of 4.3%, and continued growth is forecast for the third quarter at 4.6%.

The economy's resilience is expected to be bolstered by a global artificial intelligence boom, solid financial sector performance, and construction growth. Manufacturing, construction, and wholesale and retail trade are anticipated to expand by 8.4%, 7.1%, and 7.4% respectively, up from previous years. Inflation is projected to remain relatively low, with headline inflation at 2.1% and core inflation at 1.9%, both within the authorities' forecast range of 1.5% to 2.5%.

Despite geopolitical tensions posing risks, economists believe these factors will outweigh potential downsides. Singapore's GDP per capita ranked first in Asia and eighth globally last year, at $99,365, according to the International Monetary Fund.