Singapore Lifts 2026 GDP Forecast to 5.5%, NODX to 16%

Singapore’s economy grew faster than estimated in the second quarter, with gross domestic product rising 5.9% from a year earlier, the Ministry of Trade said Tuesday. That beat the 5.8% forecast in a Reuters poll and the 5.7% advance estimate released last month. On a seasonally adjusted quarter-on-quarter basis, GDP expanded 1.4%, ahead of the 1.1% preliminary reading.

First-half growth reached 6.1%, a pace that drove the government to raise its 2026 GDP forecast to a range of 4.5% to 5.5%, up from 2.0% to 4.0% previously. The ministry said the upgrade reflects two countervailing forces. The impact of the Middle East conflict on the Singapore economy has been milder than initially feared, while the global AI investment boom has been considerably stronger than expected.

The benefit is not evenly spread. Sectors tied to the AI-driven technology cycle are capturing the upside, while industries directly exposed to Middle East supply disruptions remain weak, the ministry said.

Enterprise Singapore separately revised its 2026 forecast for non-oil domestic exports to a range of 14% to 16%, from a prior 3% to 5%. The scale of the revision highlights how central AI-linked demand has become to Singapore’s trade performance this year. Export-oriented sectors are capturing a disproportionate share of the benefit from the technology investment cycle, the agency said.

The data positions Singapore as a clear beneficiary of the AI boom at a time when geopolitical risk continues to weigh on parts of the global economy. With first-half growth already running above the government’s original full-year forecast range, the revised 4.5% to 5.5% outlook suggests officials see the AI-driven tailwind as durable enough to sustain elevated growth through the rest of the year, even as Middle East-exposed sectors lag.