world-economy

Singapore Economy Decelerates as Middle East Tensions Offset AI-Driven Export Gains

Singapore's economic growth moderated to 5.7% in the second quarter as geopolitical instability in the Middle East weighed on trade flows, offsetting demand strength from the artificial intelligence sector. Air freight capacity has returned to more normalized levels across Gulf routes, with fuel costs easing from earlier peaks. Despite this cooling, freight rates remain elevated compared to historical averages, suggesting sustained demand from key trade corridors. The mixed signals underscore Asia-Pacific logistics operators' exposure to both cyclical demand drivers and geopolitical risk factors. These factors could reshape regional supply chains in coming quarters.