Singapore: Growth set to run above potential – UOB

FXStreetAug 11, 2026 6:01 PM

View all comments（0）



UOB economist Jester Koh highlights that Singapore’s 2Q26 Gross Domestic Product (GDP) was revised up to 5.9% year-on-year and 1.4% quarter-on-quarter, driven by AI-related strength in manufacturing and modern services. MTI raised its 2026 GDP forecast to 4.5%-5.5%, while UOB now projects 5.0% growth, expecting AI-linked capex and finance sector credit demand to support above-potential expansion despite tourism headwinds.

AI tailwinds lift Singapore growth outlook

"MTI upgraded its full-year 2026 Singapore GDP growth forecast range to "4.5 to 5.5 per cent" from "2.0 to 4.0 per cent" previously (note), reflecting better-than-expected 1H performance and an improved 2H outlook due to an acceleration in global AI-related capital expenditure, which could lift the growth prospects of economies integrated into the global technology value chain."

"We upgrade our 2026 GDP growth forecast slightly to 5.0% (from 4.8% prev; 2027F: 3.2%), with AI-related tailwinds continuing to support growth in 2H26, although momentum in the semiconductor/electronics-related sectors could moderate."

"Our baseline GDP growth projections remain relatively conservative, assuming below-trend growth of 0.5% q/q sa in both 3Q26 and 4Q26, implying 2H26 growth of 4.0% y/y (vs 1H26: 6.1%)."

"While MTI continues to cite downside risks to global growth (escalation and broadening of the ME conflict, additional US tariff actions, sharp correction in financial markets), MTI noted that Singapore’s external demand outlook for the year has improved compared with its assessment in May. US growth is expected to remain resilient on AI-related investment, although softer consumption amid sustained inflationary pressures could weigh on 2H growth."

"Growth is likely to run significantly above potential amid structural AI-related tailwinds, supported by the carryover from strong 2025 (5.0%) GDP growth."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Disclaimer: The information provided on this website is for educational and informational purposes only and should not be considered financial or investment advice.

Comments (0)

Click the $ button, enter the symbol, and select to link a stock, ETF, or other ticker.

Commenting Guidelines

Recommended Articles

Tesla Stock Price Prediction: Can TSLA Stock See a New Rally as Next-Gen Roadster Nears Launch?

TradingKey - Tesla (TSLA) is set to host a highly anticipated new vehicle launch. Tesla stated that the next-generation Roadster, originally scheduled to officially debut in Texas on October 1, has now been postponed to October 15. The model has experienced multiple delays since it was first announced in 2017 and is now re-entering the market spotlight.

US September Nonfarm Payrolls Preview: Job Growth May Cool, How Will US Stocks, Dollar and Gold React?

TradingKey - On Friday, October 2 (Eastern Time), the US will release its September nonfarm payrolls report. The market will focus on whether job growth can sustain August's rebound and whether the data will alter expectations for subsequent Federal Reserve rate hikes.

Micron Q4 Net Profit Surges Over 10-Fold YoY as Gross Margin Beats Market Expectations at 86.8%; Shares Reverse Losses to Rise 2% After Hours

On September 30 Eastern Time, after Micron Technology (MU) released its fourth-quarter fiscal 2026 financial results (for the period ended September 3) after U.S. market close, its stock price reversed earlier losses to rise 2%. Micron's Q4 revenue reached $54.229 billion, up approximately 30.81% quarter-over-quarter from $41.456 billion in the previous quarter and up approximately 379.27% year-over-year from $11.315 billion in the same period last year. This surpassed market expectations of $51.5 billion, beating estimates by about 5.30%.

US Stocks Diverge as Dow Falls Over 400 Points; Tech Stocks Lead, Intel Rises 3.7%

The U.S. annualized PCE growth rate slowed to 3.4% in August, pushing U.S. Treasury yields lower. U.S. stocks ended mixed, with mega-cap tech stocks leading the gains. At the close, the Dow Jones Industrial Average fell 0.86% to 50,906.05, the Nasdaq Composite Index gained 0.24% to 26,861.06, and the S&P 500 Index slipped 0.25% to 7,651.54.

The Week Ahead: US August PCE and September Nonfarm Payrolls Take Center Stage, Micron Earnings in Focus

TradingKey - In the coming week (September 28 to October 2, ET), US markets will face the most concentrated macroeconomic data window between late September and early October. Key reports—including the US August PCE Price Index, September Nonfarm Payrolls report, ADP employment, JOLTS job openings, and the ISM Manufacturing Index—will be released in succession, providing fresh evidence for the market to gauge the Federal Reserve's next interest rate path.

Featured Tools