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2026-07-14 08:24:12
[Singapore's Q2 economic growth slows to 5.7%, Middle East conflict drags down chemicals and biopharmaceuticals] (1) Singapore's economic growth slowed in the second quarter, with GDP growing by 5.7% year-on-year, lower than the revised 6.3% in the first quarter, but higher than the median forecast of 5.3% by economists surveyed by The Wall Street Journal. (2) After seasonal adjustment, the country's economy grew by 1.1% quarter-on-quarter, also lower than the revised 1.3% in the previous quarter, but slightly higher than the market expectation of 1.0%. (3) The expansion was mainly driven by the electronics and precision engineering sector, benefiting from strong demand for semiconductors and manufacturing equipment related to artificial intelligence; however, the chemical and biopharmaceutical manufacturing clusters contracted, with chemicals being impacted by the disruption of raw material supply caused by the Middle East conflict. (4) RHB Bank's chief economist, Barnabas Gan, believes that the Middle East conflict may be a temporary shock to the global economy rather than a structural threat, and the global and domestic fundamentals remain resilient overall. (5) Despite increased geopolitical uncertainty, Singapore's economy has remained resilient this year, supported by AI demand; however, Gan warned that if tensions in the Middle East escalate in the second half of the year, economic growth may slow to 1.0%-1.5%.
