Economy Running Hot, Registers Running Cold: Singapore 2026

Singapore's economy is running hotter than expected, but store sales are moving slowly. For brands planning to enter or expand in Singapore, the set of numbers they rely on will decide how much they order next year.

Where is Singapore's 2026 growth coming from?

The Ministry of Trade and Industry (MTI) announced on 11 August 2026 that Q2 GDP grew 5.9% year on year, first-half growth reached 6.1%, and the full-year forecast was raised from 2.0–4.0% to 4.5–5.5%. The official explanation is accelerating global capital spending on AI. The engines of this growth are semiconductors, servers and related trade, which are still some distance from the retail shelf.

Why are store sales lagging behind?

According to OCBC, based on Department of Statistics data, retail sales grew 0.7% year on year in August 2026, or 1.6% excluding motor vehicles. Year to date they are up 3.2%, compared with 2.6% in the same period of 2025. OCBC forecasts about 2.6% for the full year. Food and beverage services declined for a second consecutive month, down 1.6% in August. Visitor arrivals in the same month were about 1.6 million, flat on last year.

Three factors compound each other. Growth is concentrated in a few industries, and it takes time to reach employment and wages. Visitor numbers are flat, so tourism spending is not lifting stores. Consumers are also shifting online and across the border, which leaves local stores with a smaller share.

Which categories are growing, and which are slowing?

The same report shows beauty and personal care, computers and communications, and recreational goods still growing. Motor vehicles fell 4.6% and watches and jewellery fell 2.7%. Online sales accounted for 15.7% of retail sales, or 18.2% excluding motor vehicles, the highest level in three months.

The gap between categories is more useful than the overall movement. In the same market, some shelves are being restocked while others are accumulating inventory.

When planning Singapore for 2027, where does the problem lie?

The problem lies in the numbers used to make decisions. Estimating demand from GDP tends to overstate store sales, which leads to larger orders and more outlets. There are two places to start adjusting: use category-level retail indicators, rather than economy-wide figures, as the basis for stocking; and before setting first-quarter volumes, check whether your category sits on the growing or the slowing side.

Turning market data into a specific range and purchasing budget is the core of the ArsRes Academy Fashion Buying and Merchandising course.