SINGAPORE: 2026 GDP Forecast Upgrade Adds To MAS Tightening Risks

The final Q4 GDP print for Singapore saw y/y upward revisions to 6.9% (initial estimate was 5.7%, while the market forecast was 6.5%). In q/q terms we printed 2.1%, against an initial 1.9% outcome, but this was below the 2.6% market consensus. Full year growth was 5.0%, after a 4.4% outcome for 2024. The authorities have raised the 2026 growth forecast to 2-4% from 1-3%. Today's outcomes will likely add, at the margin, to market tightening expectations for the MAS in H1 2026. 

• The consensus expectation is for growth to be 2.7% in 2026. The past decade has seen annual growth average just over 3.3%.
• The detail for the Q4 print showed very strong conditions in manufacturing, 18.8%y/y, while all sub-industry categories saw positive y/y growth. In q/q terms, retail and transport saw modest falls (after gains in Q3). Manufacturing rose 8.4% in q/q terms, while finance gained 5.4%.
• For USD/SGD (currently near 1.2660), broader downside risks prevail, with moves towards the 20-day EMA capping the upside for now (around 1.2735/40), see the chart below. Downside focus will be on retest under 1.2600, which marked late Jan lows. Broader risk trends look more stable, albeit with a slightly softer start in Tuesday trade.
• The SGD NEER is around -0.38% from the top end of the band, per Goldman Sachs estimates. Given MAS tightening risks, dips are likely to remain supported for this index. 

Fig 1: USD/SGD Versus Key EMAs

Source: Bloomberg Finance L.P./MNI