MAS says AI-led tech sectors to keep driving Singapore growth into 2027

The Monetary Authority of Singapore told markets on Wednesday that the island-state’s AI-led economic expansion should persist into 2027, even as the pace of growth eases from what MAS called an “exceptional pace” in 2026. MAS said technology-related sectors remained the dominant driver of recent growth and accounted for roughly three quarters of year-on-year expansion.

The central bank highlighted strong order backlogs and capacity additions tied to AI-related production as the immediate supports for continued activity.

Singapore’s Ministry of Energy, Trade and Industry reported advance estimates showing the economy expanded 5.4% in the third quarter, down from 6.2% in the second quarter; MAS described the pattern as relatively concentrated in technology-linked areas.

The central bank warned that overall activity may moderate in 2027 compared with 2026, while still expecting technology to be a principal driver of growth next year. MAS pointed to industry forecasts for chip sales as consistent with an ongoing AI-led semiconductor cycle, saying those projections make it likely the tech-driven expansion will remain in an expansionary phase.

The authority also flagged strong order backlogs and capacity expansions in AI-related production as evidence that demand and supply adjustments are supporting near-term growth.

While MAS emphasised the concentration of growth in tech-related sectors, the article quoted MAS language that implied some moderation in activity next year; the central bank used the phrase “principal driver” to describe the role technology should continue to play.

Business press headlines from other outlets echoed the authority’s central points, noting that growth is expected to stay firm but the AI boost will moderate in 2027 and that third-quarter GDP softened from a recent peak but exceeded estimates.

The MAS statement and the ministry’s advance GDP figures together present a picture of robust, tech-led expansion that is narrowing from mid-2026 highs yet remains the main growth engine.

The authority’s emphasis on order backlogs, capacity expansions and chip-sales forecasts frames its view that the AI-driven cycle has both demand-side momentum and supply-side investment underpinning it.

Policymakers and market participants will be watching how activity in technology-related sectors evolves as the year progresses, given MAS’s caution that overall growth may moderate from the exceptional pace recorded in 2026.