NODX forecast lifted to 15.5% as US tariff threatens one-third of exports

Enterprise Singapore also raised its 2026 NODX band to 14%-16% from 3%-5% as July exports jumped 24.2%.

Full-year non-oil domestic exports (NODX) growth for 2026 has been revised upward to 15.5% from 11.5%, on stronger-than-expected year-to-date performance and sustained strength in electronics and electrical (E&E) exports.

The revision from RHB follows Enterprise Singapore data showing NODX rose 24.2% from last year in July, accelerating from an upwardly revised 20.8% increase in June. NODX growth averaged 19.4% over the first seven months of 2026.

Looking ahead, RHB said the ongoing tech upcycle and sustained AI-driven demand "should continue to underpin exports and manufacturing activity" through the remainder of the year.

"This is also reflected in Enterprise Singapore's upward revision of its 2026 NODX forecast to 14% to 16%, from 3% to 5% previously, citing the exceptionally strong performance in 1H26, led by electronics," it added.

Despite the stronger-than-expected performance, RHB noted that underlying momentum has softened, with NODX contracting 0.3% month-on-month on a seasonally adjusted basis in July.

RHB said it remains vigilant to downside risks, flagging the 12.5% US tariff imposed on 24 July under Section 301 of the US Trade Act of 1974, which is estimated to affect around one-third of Singapore's exports.

Meanwhile, UOB said AI-related tailwinds are likely to remain a key driver of export momentum in the second half.

"Supporting this view, the Jul electronics PMI improved to 52.4 (Jun: 52.2), with broad-based strengthening in the new export orders and order backlog sub-indices signalling resilient end-demand," UOB said in a separate analysis.

The bank added that substantial capital expenditure commitments by major hyperscalers and technology firms through 2026 and 2027 should continue to underpin demand for memory and compute chips, as well as AI-related hardware and peripherals.

"However, tariffs continue to cloud the export outlook. A recent White House report titled 'The Great Transshipment Scam' details how Chinese exports are allegedly rerouted through third countries, often with limited value added, before entering the US to circumvent tariffs," UOB said.

The White House report states jurisdictions identified by the US government as associated with elevated risks of China-linked illegal transhipment.

The report classified Singapore as Tier 3, covering smaller economies with lower transhipment volumes but features that could make them attractive for rerouting China-linked goods to the US.

"This could serve as a precursor to stronger enforcement of tariffs targeting goods deemed to be involved in 'transshipment' activities, or to the introduction of additional tariffs," UOB said.