Singapore's economy grew by 4.6% y-o-y in the first quarter of the year, moderating from 5.7% chalked up in the preceding quarter.
However, on a q-o-q seasonally adjusted basis, the economy contracted by 0.3%, reversing from growth of 1.3% in 4Q 2025, according to advanced estimates by the Ministry of Trade and Industry on April 14.
"While GDP growth remained resilient in the first quarter of 2026, the US-Israel-Iran conflict that began in end-February may weigh on economic activity in the coming quarters," says MTI on April 14.
The government had earlier warned that this year's economy might slow. There's no mention in MTI's announcement on April 14 of changes in this year's GDP forecast.
Just two months ago, the government raised its 2026 projection to 2 to 4%, from 1 to 3%.
The revised forecast in February was made in the backdrop of a faster-than-expected 6.9% y-o-y growth in the final quarter of 2025, with expectations that momentum driven by AI spending and tariffs had yet to cause as much of an impact as feared.
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The surge in the final quarter brought Singapore's full year 2025 GDP growth to 5%.
However, since the upgrade in February, the US had raised further issues with trading partners and launched a war against Iran, jacking up energy prices, setting off second order impacts and unsettling global financial markets.
Among the major economic sectors in 1Q 2026, construction was the best performer with a jump of 9% y-o-y while manufacturing was up 5%. However, on a q-o-q basis, manufacturing was down 4.9%.
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Services industries as a whole was up 4.7% y-o-y, and 0.6% q-o-q.
MTI will release additional and updated details in May.
