Singapore’s key exports surprise again with 22.2% surge in October, beating forecasts

[SINGAPORE] Robust artificial intelligence (AI)-related demand underpinned the Republic’s strong export showing in October, said economists, though they remained cautious over the outlook for 2026.

Non-oil domestic exports (NODX) surged 22.2 per cent year on year last month, extending the 7 per cent expansion clocked in September, data from Enterprise Singapore (EnterpriseSG) showed on Monday (Nov 17).

The performance surprised private-sector economists, who had anticipated a 7.5 per cent growth on a yearly basis in a Bloomberg poll. Several were prompted to upgrade their full-year NODX forecasts.

“A structural shift in AI-linked electronics demand and reordering of Asian supply chains suggest Singapore’s exports may be more resilient than initially expected in the face of higher global trade barriers,” said Sheana Yue, senior economist at Oxford Economics.

Maybank economists Chua Hak Bin and Brian Lee expect the wave of AI investments to continue in 2026, on account of major US tech firms having lifted their guidance for capital expenditures.

They also pointed to emerging signs that the generative AI boom is starting to spread from data centres to consumer devices such as smartphones and laptops, “which will likely deliver a further boost to electronics demand”.

Year on year, both electronics and non-electronics exports grew in October.

Electronics exports jumped 33.2 per cent on the year, extending the preceding month’s 30.4 per cent increase. Integrated circuits (40.9 per cent), PCs (77.7 per cent) and disk media products (31.4 per cent) contributed the most to the expansion in electronics NODX.

Meanwhile, non-electronics shipments rose 18.8 per cent, after September’s 0.5 per cent increase.

The main growth drivers were non-monetary gold (176.8 per cent), specialised machinery (16.1 per cent) and pharmaceuticals (25.2 per cent), though DBS senior economist Chua Han Teng noted that this expansion was partly supported by favourable low-base effects.

UOB associate economist Jester Koh said “lingering elements” of front-loading in anticipation of potential US semiconductor tariffs could have also contributed to the strong showing by pharmaceuticals.

This followed earlier announcements of 100 per cent tariffs on branded or patented pharmaceutical products, which have had delays in implementation, he noted.

All in all, NODX grew 4.1 per cent year on year for the first 10 months of 2025. The latest data puts it on track to surpass EnterpriseSG’s official full-year forecast range of 1 per cent to 3 per cent, said Koh.

In view of October’s strong showing, several economists raised their full-year NODX growth forecasts.

Yue now expects export volumes to grow by 6.4 per cent in 2025, up from 5.3 per cent. For 2026, she projects expansion at 1.1 per cent, from a contraction of 0.4 per cent previously.

Meanwhile, Maybank is tipping full-year NODX growth to “comfortably exceed” EnterpriseSG’s estimates of 1 per cent to 3 per cent, hitting 4 per cent to 5 per cent instead.

Both OCBC chief economist Selena Ling and RHB group chief economist Barnabas Gan have upgraded their full-year NODX growth forecasts to 4 per cent, from an earlier 2 per cent.

Even so, they remained cautious over the outlook for 2026, citing uncertainty over US sector-specific tariffs on semiconductors and pharmaceuticals.

As Yue sees it, Singapore’s open and trade-reliant economy “exposes it to indirect effects from higher tariffs elsewhere, while lingering ambiguity surrounding transhipment may affect re-exports”.

“We anticipate a slower and more gradual hit than initially expected, reflecting delays in implementation and compliance by US Customs,” she said, adding that potential semiconductor tariffs remain the primary risk for Singapore.

Ling noted that the concerns for 2026’s outlook revolve around American growth slowdown, the Federal Reserve’s interest-rate trajectory, potential product-specific tariffs that could drive re-shoring and foreign direct investment back to the US, as well as ongoing volatility in the AI industry.

In contrast, Maybank’s team is more optimistic.

They expect export growth to remain resilient in the fourth quarter and 2026, noting that “the economy is firing on multiple cylinders, along with a construction boom, falling interest rates and generous fiscal support”.

Performance by market

In October, key exports to all but two of Singapore’s top 10 markets increased.

NODX to the US contracted by the largest extent at 12.5 per cent, following a 9.8 per cent decline the previous month. This was followed by Japan at a 0.1 per cent contraction, reversing an 8.2 per cent growth the month before.

In contrast, NODX to all other markets posted growth in October. This was led by Thailand at 91.1 per cent, followed by Hong Kong (66.9 per cent) and Taiwan (61.5 per cent).

DBS’ Chua pointed out that this “sustained strength” to other top destinations was notable and more than offset the sixth straight month of NODX contraction to the US.

“This demonstrated some signs of near-term resilience by global supply chains in adjusting to the evolving US tariffs situation,” he said.

The latest data reinforces that regional demand remains a key pillar of support for Singapore’s external sector, said Gan.

“Greater regional supply-chain integration and the rising importance of Asian consumption have helped cushion Singapore against external shocks, including the protectionist risks from the US,” he added.

Overall, total trade grew 23.2 per cent year on year in October, following the previous month’s 14.6 per cent increase. Total exports rose 25.2 per cent; total imports were up 21 per cent.