Singapore’s economy expands faster than expected in the first quarter, supported by the global artificial-intelligence boom despite concerns about potential spillover from the Iran conflict. The Ministry of Trade and Industry (MTI) reports that gross domestic product (GDP) rises by 1.0% on a quarter-on-quarter, seasonally adjusted basis for the three months through March. This performance contrasts with an advance estimate that pointed to a 0.3% contraction and is stronger than market expectations cited by outlets.
Both reports attribute the better-than-expected result largely to AI-related demand lifting activity in Singapore’s manufacturing and services sectors. At the same time, higher energy and crude oil-related costs weigh on the economy, contributing to a slowdown in some areas. Al Jazeera also reports that GDP increases by 6% year-on-year in the quarter.
Overall, the government signals that risks remain, including possible effects from an Iran-related war environment, but the AI-led expansion in the early part of the year is the dominant factor behind the quarter’s stronger growth.
