Singapore’s economy grows more than 5 percent amid AI boom

City-state’s GDP expands 5.4 percent in July-September quarter, according to advance government estimates.

Singapore’s economy grew more than 5 percent in the most recent quarter, continuing an AI-fuelled boom that has made the city-state one of the fastest-growing advanced economies.

Manufacturing, which is dominated by the city-state’s semiconductor industry, grew 7.5 percent, according to the estimates from the Ministry of Trade and Industry.

Construction, including AI-related investments such as data centres, expanded 8.8 per cent, according to the figures.

The Monetary Authority of Singapore, which manages monetary policy through currency exchange rates rather than interest rates, said it expected core inflation to average 1.5–2.0 percent in 2026.

Singapore is a major global player in the booming chip sector, a position that has helped it weather choppy economic conditions, including the energy shock prompted by the US-Israel war on Iran.

Yeow Hwee Chua, an assistant professor of economics at Nanyang Technological University, described Singapore’s economic performance as “impressive for a high-income economy, especially given the uncertain global environment”.

“Strong demand for electronics has supported manufacturing and related wholesale trade, illustrating how Singapore benefits from its position in global supply chains,” he said.

The city-state’s GDP grew 5 percent in 2025, its second straight year of growth above 5 percent – the first such streak since 2010 and 2011.