Singapore's GDP Up 4.3% in Q2 Despite US Tariff Uncertainty

Better-than-expected showing spurs some economists to raise 2025 growth forecast

- Angela Tan

Singapore's economy continued to grow in the second quarter of 2025, skirting a technical recession despite persistent global trade headwinds and US tariff uncertainty weighing on the export-reliant economy.

The better-than-expected performance has prompted some economists to raise their growth forecast for 2025 to beyond the official range of zero per cent to 2 per cent.

A technical recession is defined as two consecutive quarters of negative growth, unlike a full-blown economic recession, which takes into account year-on-year performance.

Based on advance estimates by the Ministry of Trade and Industry (MTI), the economy grew 4.3 per cent year on year in the second quarter of 2025, extending the 4.1 per cent growth in the previous quarter.

Analysts' consensus estimate by Reuters was for 3.5 per cent growth in the second quarter.

On a quarter-on-quarter seasonally adjusted basis, the economy expanded by 1.4 per cent, a turnaround from the 0.5 per cent contraction in the first quarter of 2025, MTI said on July 14.

Gross domestic product growth for the first quarter was revised up to 4.1 per cent, from the earlier estimate of 3.9 per cent.

For the first half of 2025, Singapore's GDP growth averaged 4.2 per cent year on year.

"Looking forward, there remain significant uncertainty and downside risks in the global economy in the second half of 2025 given the lack of clarity over the tariff policies of the US," MTI said in a statement.

The latest figures come as Singapore grapples with fragile external demand as the US intensifies its trade war with major trading partners.

Singapore, where external trade is three to four times its GDP, was hit with a 10 per cent tariff rate despite the US enjoying a goods trade surplus of US$2.8 billion (S$3.6 billion) with the Republic in 2024.