RHB raises industrial production forecast to 7% after strong April output

The bank said AI-driven electronics demand could lift GDP growth towards the top end of MTI’s forecast range.

RHB raised its full-year industrial production growth forecast to 7.0% for 2026, from 4.0%, after April manufacturing output came in stronger than expected.

The bank said Singapore’s full-year GDP growth will likely be revised higher towards 4.0%, the upper end of the Ministry of Trade and Industry’s 2.0% to 4.0% forecast range.

Singapore’s industrial production rose 17.6% YoY in April, accelerating from a revised 9.2% increase in March and beating Bloomberg’s forecast of 12.0%. On a seasonally adjusted month-on-month basis, output grew 5.8%.

RHB said growth was anchored by electronics and general manufacturing, with the electronics sector supported by sustained global semiconductor demand, AI applications, and continued technology upgrade cycles.

Electronics output expanded 44.0% YoY in April. Within the cluster, semiconductors grew 42.6%, whilst infocomms and consumer electronics surged 129.6%.

RHB also cited stronger electronics exports, with April electronics non-oil domestic exports rising 66.7% YoY on sustained AI-related demand, as a sign of firmer industrial momentum.

Other growth contributors included precision engineering, which rose 15.1%, transport engineering at 10.1%, and general manufacturing at 16.9%.

However, chemicals remained a drag due to weakness in petroleum and petrochemicals, partly linked to Middle East tensions and uncertainty in the energy market, affecting feedstock supply.

RHB also flagged the possibility of further weakness in biomedical manufacturing in the second half of 2026 if pharmaceuticals continue to decline.

The bank said it remains optimistic on Singapore’s trade and manufacturing outlook, but warned that external risks require close monitoring.

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