MUFG’s Senior Currency Analyst Lloyd Chan notes that Singapore’s FY26 budget marks a strategic pro‑growth pivot, with higher development spending aimed at building national AI capabilities, supporting enterprise funding, and attracting high‑quality capital. The government has upgraded its 2026 growth outlook, underpinned by strong late‑2025 momentum and sustained investment in advanced manufacturing, semiconductors, and AI‑related activities.
AI and investment drive upgraded growth outlook
“Spending priorities signal a strategic growth pivot. Higher overall expenditure is partly driven by a notable step‑up in development spending, with a clear focus on building national AI capabilities, supporting enterprise funding, attracting high‑quality capital, and providing targeted cost‑of‑living relief. This spending will be supported by firmer corporate tax revenues and rising net investment returns, preserving fiscal sustainability.”
“The government has upgraded its 2026 growth outlook, reflecting strong late‑2025 momentum and sustained investment in advanced manufacturing, semiconductors, and AI‑related activities. Plans to establish a National AI Council, chaired by Prime Minister Lawrence Wong, will help position AI related technology adoption as a key lever to lift potential growth and help offset demographic headwinds over time.”
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Source: https://www.fxstreet.com/news/singapore-pro-growth-fy26-budget-with-ai-focus-mufg-202602131904
