Singapore’s Q2 GDP Beats Forecasts Despite Global Trade Headwinds

Singapore’s economy expanded 4.3% year-on-year in Q2 2025, surpassing the 3.5% growth forecast by economists, according to preliminary data from the Ministry of Trade and Industry. The quarter-on-quarter growth stood at 1.4%, rebounding from a revised 0.5% contraction in Q1 and averting a technical recession.

Economists attributed the stronger-than-expected performance to front-loaded exports and a temporary easing of global trade tensions. “The economy is proving resilient amid tariff shocks and geopolitical uncertainty. Exporters capitalized on the 90-day tariff reprieve between the U.S. and China,” said Maybank economist Chua Hak Bin.

Despite this robust quarter, concerns remain over the outlook for the second half of the year. Trade Minister Gan Kim Yong noted that while the economy benefited from export acceleration during the pause in tariffs, growth may slow over the next 6 to 12 months.

In April, Singapore’s full-year GDP forecast was revised downward to a range of 0% to 2%, from the previous 1% to 3%. Maybank currently projects 2025 growth at 2.4% and expects the Monetary Authority of Singapore to maintain its current policy stance in its upcoming review.

Meanwhile, global trade tensions continue to loom. U.S. President Donald Trump recently announced tariffs ranging from 20% to 50% on over 20 countries, effective August 1. Although Singapore has not yet received a formal notice, its exports remain under a 10% baseline tariff imposed in April—despite a longstanding U.S.-Singapore free trade agreement.

Minister Gan plans to visit Washington later this month to negotiate tariff relief, particularly for pharmaceuticals, as the U.S. signals possible levies on copper, semiconductors, and drug products—deepening the already volatile global trade environment.