Singapore records strong 5.7% economic growth in second quarter

Goods-producing sector expanded 10.4%, up from 8.4% in the previous quarter.

Singapore’s economy expanded 5.7% in the second quarter, beating market expectations, mainly due to strong growth in the manufacturing sector.

The growth rate was higher than the 5.5% forecast by economists surveyed by Reuters. However, it was lower than the revised 6.3% growth recorded in the first quarter, according to Singapore’s Ministry of Trade and Industry.

The goods-producing sector expanded 10.4%, up from 8.4% in the previous quarter. Meanwhile, growth in the services sector slowed to 4.6%, down from 6.2% in the first quarter.

DBS Bank Senior Economist Chua Han Teng said Singapore’s advance second-quarter GDP figures showed the economy remained resilient despite the impact of tensions in the Middle East.

He said strong trade activity and continued growth in domestic construction are expected to support the economy over the coming quarters. However, he warned that GDP growth is likely to moderate because future results will be measured against a strong base.

In May, Singapore’s Ministry of Trade and Industry maintained its 2026 GDP growth forecast at 2% to 4% but said downside risks had increased significantly because of the U.S.-Israel-Iran conflict.

The advance GDP figures were released ahead of Singapore’s central bank announcing its quarterly monetary policy decision later this month.

Unlike many central banks, Singapore does not use interest rates as its main monetary policy tool. Instead, it manages monetary policy by controlling the value of the Singapore dollar against the currencies of its major trading partners through an undisclosed trading band known as the Singapore dollar nominal effective exchange rate (S$NEER).

After the GDP data was released, the Singapore dollar traded at 1.294 against the U.S. dollar, slightly weaker than before.

The GDP report also came after Singapore’s inflation rate remained unchanged at 1.8% in May, matching its highest level since September 2024.

The Monetary Authority of Singapore (MAS) said in its Consumer Price Index report that global energy prices remain higher than they were in 2025. It forecasts full-year inflation of 1.5% to 2.5%.