Economists Upgrade Singapore’s 2025 Growth Forecast to 2.4% Driven by Strong Manufacturing and Export Performance
Private-sector economists have raised Singapore’s 2025 growth forecast to 2.4%, up from 1.7% in the previous survey, following a stronger-than-expected performance in Q2 2025. The latest Monetary Authority of Singapore (MAS) survey revealed that economists are more optimistic about the full-year growth prospects, particularly due to robust manufacturing, exports, and the construction sector.
The upgraded outlook is based on a significant Q2 GDP performance of 4.4%, far surpassing the previous forecast of 3%. Economists attributed this stronger growth to better-than-expected performance in sectors like manufacturing, wholesale and retail trade, and non-oil domestic exports, driven by the AI boom and front-loading of orders.
Key sectoral upgrades include:
- Manufacturing growth now expected at 0.8% (up from a previous forecast of -0.3%).
- Wholesale and retail trade growth revised to 2.9% (from 2.2%).
- Construction sector forecast raised to 4.7% (from 3.3%).
However, the accommodation and food services sector saw its outlook downgraded to 0.5% growth, down from the earlier projection of 1.5%.
Inflation expectations for 2025 remain stable, with headline inflation projected at 0.9% and core inflation at 0.7%. The unemployment rate is also expected to remain steady at 2.2%.
While economists see risks from geopolitical tensions and potential tariffs on semiconductors and pharmaceuticals, they are also optimistic about the tech sector’s growth. Electronics, a major driver of Singapore’s economy, is expected to benefit from AI-driven demand and exemptions from US tariffs.
Regarding monetary policy, there’s increasing speculation that MAS may ease its policy in October 2025, with a minority expecting a reduction in the slope of the Singapore dollar exchange rate policy band.
