Singapore business confidence for Q1 2026 slides: SCCB

[SINGAPORE] Local business sentiment has fallen slightly for the first quarter of 2026, revealed data from the Singapore Commercial Credit Bureau (SCCB) on Tuesday (Dec 16).

The Business Optimism Index, tracked by SCCB, fell to 4.3 percentage points for Q1 2026, dipping from 4.5 percentage points in the prior quarter.

On a year-on-year basis, the decline was more pronounced, dropping from 5.45 percentage points in Q1 2025.

“The moderation in business confidence for Q1 2026 signals that firms are bracing for flatter growth ahead,” said SCCB chief executive Audrey Chia.

Despite the decline in optimism, all six key business indicators – volume of sales, net profit, selling price, new orders, inventory, and employment – remain in positive territory for the quarter.

“While overall sentiment remains expansionary, the decline in selling prices and employment levels suggests businesses are adopting a more conservative stance amid persistent cost pressures and global uncertainties,” Chia added.

The moderation in sentiment comes as the Ministry of Trade and Industry projects gross domestic product growth for 2026 to be between 1 and 3 per cent.

Divergence across industries

The data revealed a divergence in outlook across industries. The financial and services sectors are projecting upbeat sentiments, whereas the construction, manufacturing, and wholesale sectors are expecting moderation.

• Services and financial: These sectors emerged as the most resilient. The services sector saw a visible improvement in outlook, with all six indicators in positive territory. Meanwhile, the financial sector had five of the six indicators in positive territory. Both volume of sales and net profit for the financial sector rose from 14.29 percentage points in the fourth quarter of 2025 to 21.43 percentage points in Q1 2026.
• Transportation: Sentiment remains upbeat, specifically regarding selling prices (25 percentage points) and employment (25 percentage points), which were the highest among all sectors. New orders rose from 8.33 percentage points in Q4 2025 to 16.6 percentage points in Q1 2026. However, the sector saw a slight moderation in the three other indicators. Volume of sales and net profit fell from 16.67 percentage points to 8.33 percentage points quarter on quarter, and inventory levels declined from 8.33 percentage points to zero percentage point.
• Construction: The sector remains “cautiously optimistic”, with a visible moderation in four indicators. Selling price expectations, for instance, nearly halved from 15.39 percentage points in Q4 2025 to 7.69 percentage points in Q1 2026. Employment levels also moderated, from 9.09 percentage points to zero percentage point. However, new orders jumped from zero percentage point in Q4 2025 to 7.69 percentage points in the following quarter.
• Manufacturing: Manufacturers reported a moderate improvement in sentiment, with four indicators in positive territory. Selling price rebounded from minus 5.88 percentage points in Q4 this year to zero percentage point in the following quarter. However, new orders remained in the contractionary zone for Q1 2026 at minus 3.7 percentage points, though this was an improvement from minus 5.88 percentage points in the previous quarter.
• Wholesale: This sector appears the most downbeat, with four of the six indicators in negative territory. Volume of sales, net profit and selling price outlooks declined steeply, all hitting minus 13.33 percentage points. Inventory levels fell from zero percentage point in Q4 2025 to minus 6.67 percentage points in Q1 2026.

SCCB noted that businesses in sectors outside of services and finance are prioritising “cost management and operational efficiency” to navigate the challenges ahead.

SEE ALSO

Nearly 60% of global CEOs, investors expect deglobalisation to ramp up in 2026: report

Singapore hiring outlook worsens sharply to 4-year low: ManpowerGroup survey

Indicator performance

While all indicators remained expansionary (positive) on average, the momentum varied.

• Selling price: This had the sharpest decline for Q1 2026, falling to 5.93 percentage points from 10 percentage points in the previous quarter.
• Employment: It moderated slightly to 2.96 percentage points, down from 3.25 percentage points in Q4 2025.
• Volume of sales, net profit: These remained flat quarter on quarter at 5.93 percentage points.
• New orders, inventory: New orders rose to 3.7 percentage points, from 2.4 percentage points in the previous quarter. Inventory levels rebounded to 1.48 percentage points, from minus 0.85 percentage point previously.