Singapore’s economy is set to grow by 1.8% in 2026, according to the latest outlook from DBS Group Research. The report highlights the city-state’s ability to navigate global challenges, including tariffs and technological cycles, whilst maintaining economic stability. Despite a slowdown from the estimated 4.0% growth in 2025, Singapore’s modern services and construction sectors are expected to provide a buffer against trade-related moderation.
Inflation is projected to rise slightly, with core inflation at 1.0% and headline inflation at 1.2%, yet remain manageable. The Monetary Authority of Singapore is anticipated to maintain its current monetary policy, with the Singapore Dollar expected to trade between 1.25 and 1.30 against the US Dollar.
DBS notes that Singapore’s modern services sector, encompassing finance, insurance, and ICT, will play a crucial role in supporting economic growth. The finance sector is poised to benefit from increased trading activity, whilst the ICT sector is expected to continue its positive momentum, driven by advancements in digital technology and AI adoption.
The report underscores Singapore’s position as a trusted financial centre and business hub, with ongoing political stability and policy continuity under the leadership of the fourth-generation team. As Singapore faces global economic shifts, its resilience and strategic focus on modern services and digitalisation are expected to sustain its economic vibrancy in the coming years.
