Singapore on Tuesday sharply lifted its annual economic growth forecast, citing a stronger-than-expected performance in the first half and boost from AI-related sectors and exports.

The Ministry of Trade and Industry said GDP growth for 2026 is now expected to come in at 4.5% to 5.5%, more than double the lower end of its previous forecast of 2%-4%.

MTI added that that the economic impact of the U.S-Iran conflict has also been less severe than initially feared, pointing out that the drawdown of oil inventories and substitution to alternative energy sources have capped the rise in global energy prices.

Singapore has upgraded its growth estimates for a second time this year. At the start of the year, MTI had estimated growth at 1%-3%.

The announcement comes as Singapore reported revised growth numbers for the second quarter, with the city-state’s economy expanding 5.9%, compared with 5.7% in advance estimates.

The performance in the second quarter was mainly driven by the manufacturing, wholesale trade, as well as the finance and insurance sector, MTI said.

The strong performance is likely to offer some room for the Monetary Authority of Singapore to act against inflation. The MAS had tightened its monetary policy in late July in an unexpected move.

At the time, the central bank said that Singapore’s imported costs are likely to rise in the quarters ahead, due to higher fuel and electronic input costs, while also factoring in adverse weather conditions in Singapore’s import sources. 

Singapore’s core inflation, which excludes accommodation and transportation costs, rose to 1.6% in June from 1.4% in May, near the bottom of the MAS’ 1.5%–2.5% forecast range for this year, with headline inflation at 1.9%.

Grindr is betting that artificial intelligence can do more than just improve the dating app experience.

It believes AI can simultaneously create a new premium subscription business while also dramatically changing how quickly its engineers build software.

“Our strategy has always been to use AI everywhere we can,” said CEO George Arison in an exclusive interview with CNBC.

The LGBTQ-focused dating platform on Thursday reported second-quarter revenue of $138 million, up 33% from a year ago. The company also raised its 2026 guidance and now expects full-year revenue of approximately $540 million, up from $535 million, and adjusted earnings before interest, taxes, depreciation, and amortization of approximately $232 million, up from $227 million.

Arison said the company’s results are early evidence that his AI strategy is starting to pay off.

Rather than focusing solely on consumer-facing features like Grindr’s new premium AI companion called Edge, Arison is also deploying AI across the business to reduce the cost and time required to build new software products.

Grindr estimated that total engineering output increased roughly 2.5 times between July 2025 and April 2026, the earnings presentation showed, despite maintaining roughly the same size engineering team.

“Before GenAI, producing that much technical output would have required roughly 200 additional engineers and approximately $60 million in annual cost,” the earnings presentation said.

The gains have allowed Grindr to release products faster without meaningfully increasing engineering head count, a trend investors are increasingly watching across the software industry as companies look for tangible financial returns from generative AI investments.

While spending on large language models continues to rise, he said the return on investment has made the decision an easy one.

“We were on track to spend $6 million on tokens this year,” Arison said. “I have zero qualms about that because the amount of productivity increase that I’m getting from that is orders of magnitude more, like 10-times more than the money that I’m spending on tokens. So it’s a total no-brainer.”

Arison said Grindr has not eliminated any jobs because of AI adoption, but has aggressively expanded the use of coding assistants and software development tools from Cursor, Anthropic’s Claude and Devin.

“You can run these businesses in a far leaner way than people think you can, but you need much better management,” said Arison.

The company is testing pricing for its AI-powered Edge companion in select markets, including New York, where access costs as much as $350 per month.

Initially, management expected Edge to primarily attract upgrades from its highest-paying subscribers. Instead, Grindr said, the customer mix has been broader.

“Our assumption was that only people who are Unlimited subscribers would move up to Edge,” Arison said. “The data…

The drought in Europe is so severe that it is jeopardizing countries’ economic growth and forcing them to take extreme measures like blowing up riverbeds.

Gripped by a summer of weather extremes, Romania recently shut down its sole working nuclear reactor cooled by the Danube for the first time, with Bucharest even deploying naval forces to carry out underwater detonations to improve water flow.

Images published Monday showed the Romanian navy blasting rocks in controlled explosions in Izvoarele village as part of a push to divert a higher volume of water toward the cooling systems of the Cernavoda Nuclear Power Plant.

Low water levels on the Danube have also threatened to close Hungary’s Paks nuclear plant, which supplies around 40% of the country’s electricity, and forced Serbia to cut hydropower generation.

Japanese Prime Minister Sanae Takaichi has pushed forward with her plan to slash the consumption tax on food, which reportedly would be the first time the tax will be cut since its implementation in 1989 if she succeeds.

On Tuesday, the ruling Liberal Democratic party advanced the bill through key committees, with Nikkei reporting Takaichi wants cabinet approval by this month, and for the bill to be tabled in parliament in the autumn.

Takaichi said last Thursday that Japan would cut the tax on food to 1% from 8% for two years from April 2027, and offer cash payments to offset the impact of that 1% on select groups.

The food-tax cut captures the central gamble behind Takaichi’s economic agenda: Japan is giving up revenue now in the hope that stronger consumption and an estimated 370 trillion yen (2.35 trillion) public-private investment plan through to the 2040 fiscal year will help boost growth.

The plan, which will cut an estimated 4.4 trillion yen in revenue from the government’s coffers has already drawn criticism from her own Liberal Democratic Party, including former ministers Taro Kono and Takeshi Iwaya. Nikkei also reported that former Prime Minister Shigeru Ishiba walked out of the meeting halfway.

In a post on X, Kono, former defense minister under the Abe administration, warned that the plan could undermine confidence in Japan’s fiscal position, push interest rates higher and weaken the yen.

Iwaya, who served as foreign affairs minister in 2024 and 2025 has also argued against the cut, reportedly saying “The risk is very high. If the market reacts negatively, the yen will weaken further and import prices will rise.”

Even the International Monetary Fund urged Tokyo to not reduce the consumption tax in its 2026 country report, saying it was “an untargeted measure that would erode fiscal space and add to fiscal risks.”

Takaichi has pledged not to use deficit-financing bonds to fund her schemes, instead the government has said it will review spending, tax breaks, subsidies and public funds, but details are scarce. She has also made it clear the the cut will be just for a 2-year period, after which the consumption tax will revert to 8%.

Still, Japan grapples with one of the highest public debt levels in the world, with the International Monetary Fund projecting government debt at roughly 204% of gross domestic product in 2026, making any additional borrowing detrimental to its fiscal health.

Justin Heng, APAC rates strategist at HSBC Global Investment Research, said Takaichi’s latest economic blueprint had “effectively cemented” an expansionary fiscal stance, while the government had loosened its guardrails by moving away from a primary-surplus target for its budget.

“With limited clarity on funding channels, additional debt issuance…

China’s industrial profits rose 15.1% in June from a year earlier, according to data released Monday by the National Bureau of Statistics, slowing for a second straight month as easing energy prices took the edge off the price gains that had driven this year’s rebound.

The June figure extended a two-month deceleration, after May’s 21.1% gain marked the first slowdown since November.

For the first half of this year, profits climbed 18.7%, slowing from the 18.8% pace recorded in the January-May period.

Industrial corporate earnings have staged a notable turnaround this year, swinging from barely positive growth in 2025 to double-digit gains, as an artificial intelligence-fueled boom in chip and equipment manufacturing coincided with the end of nearly three years of factory-gate deflation.

The recovering profit has also been helped by a favorable comparison with last year. Earnings fell 3.6% in June last year and declined 2.8% in the first half of 2025.

Factory-gate prices also rose 3.6% year on year in the second quarter, the first positive reading since late 2022.

That reflation boost appears wobbly, as much of the price recovery was driven by surging global energy costs, while domestic demand lags, economists say.

Producer prices dipped 0.3% month-on-month in June, the first decline since July 2025, according to LSEG data, as normalizing tanker flows through the Strait of Hormuz pulled oil, refined-fuel, and petrochemical prices lower.

Investors will now turn to the Communist Party’s Politburo meeting, traditionally held in late July, where top leaders will review first-half performance and set policy direction for the rest of the year.

Economists anticipate stronger easing language after the second-quarter slowdown, though expectations for a large stimulus package remain low, as Beijing refrains from more forceful action given resilient exports and its focus on curbing excess factory capacity.

“The Politburo is likely to make policy support mildly more urgent, prioritizing faster fiscal rollout,” said Robin Xing, chief China economist at Morgan Stanley, pegging their baseline as a “gradual policy ramp-up rather than a one-off stimulus push.”

“Growth should stay resilient thanks to exports, even as domestic demand lags,” Xing said, citing the AI-driven investment cycle — in which China is a key hardware supplier — and a broader Asian industrial capex super-cycle that is now unfolding.

When Alphabet and Tesla kicked off tech earnings season on Wednesday, one theme became immediately clear: AI spending is under a microscope.

Both companies reported negative free cash flow for the latest quarter and told investors to prepare for higher capital expenditures. They both also reported better-than-expected revenue, but that wasn’t enough to prevent an after-market selloff, with Tesla shares sliding 4% and Alphabet down more than 3%.

It’s a potentially ominous sign for the tech industry, particularly the other megacaps, which are mostly set to report quarterly results next week. Meta and Microsoft are scheduled to report next Wednesday, followed a day later by Amazon and Apple.

Much of the AI boom to date has been fueled by historic levels of infrastructure spending among a small crop of companies, including hefty investments into model developers OpenAI and Anthropic. But the recent emergence of cheaper open-source models, largely out of China, along with signs that corporate America is getting more frugal when it comes to spending on AI services, has raised concerns about the future returns on investment.

Heading into Wednesday’s reports, Alphabet’s stock was already on pace for its third straight monthly decline after surging in April, while Tesla shares were down 11% in July and 17% for the year. The tech-heavy Nasdaq has dropped about 5% since reaching a record in early June.

While Alphabet and Tesla are both spending at unprecedented levels, their numbers vary dramatically.

Google’s parent company forecast capex for this year of $195 billion to $205 billion and warned of higher numbers in 2027. Prior guidance was for spending of $180 billion to $190 billion. At the top end of the new range, Alphabet could be the biggest spender in tech this year, as Amazon’s latest guidance was for more than $200 billion, though that number may increase when the company reports results next week.

Google and its hyperscaler peers are building out data centers packed with advanced chips so they can provide the computing power necessary to build and run the leading AI models and the services they power.

Mizuho analysts wrote in a note that Google’s capex increase was “broadly anticipated,” and that the overall story is positive, largely due to the surge in cloud revenue, which jumped 82% from a year earlier, blowing past estimates. Cloud margins expanded and usage of Google’s Gemini model accelerated.

“As such we are surprised the stock is trading off after hours and would expect it to recover in trading tomorrow,” wrote the analysts, who recommend buying the stock.

Tesla reiterated expectations for more than $25 billion in capex this year, which would represent about 200%…

China’s economy in the second quarter grew at its weakest pace since 2022, as an accelerating slide in investments deepened the strain on growth while consumption stayed subdued.

Gross domestic product growth came in at 4.3% in the April to June period, data from the National Statistics Bureau showed Wednesday, missing economists’ forecast for 4.5% growth in a Reuters poll, and slowing from 5% in the first quarter.

That second-quarter growth came below Beijing’s full-year growth target range of 4.5% to 5%, the least ambitious goal in decades, amid tensions with trade partners, including the U.S. and the European Union, and sluggish domestic demand.

Urban fixed-asset investment, including real estate development and infrastructure projects, declined 5.7% in the first six months from a year earlier, worse than expectations for a 4.9% drop in a Reuters poll, and steepening from a 4.1% contraction in the first five months.

In June, China’s retail sales grew 1%, rebounding from a 0.6% drop in the prior month and exceeding economists’ forecast for a 0.1% fall. Retail sales in May posted their first monthly decline since late 2022, dragged down by tepid demand and merchants’ steep discounting.

Industrial output expanded 5.3% in June from a year ago, stronger than the forecast 4.7% growth, and gaining pace from 4.5% expansion in May.

Chinese economy has grappled with a deepening supply-demand imbalance. Robust industrial production and exports tied to the global AI investment boom continue to power headline growth, even as consumption and private investment weakens amid a prolonged property downturn and volatile energy prices.

Urban investment slumped for the first time in decades last year, falling 3.8% from a year earlier, as a prolonged property downturn and tighter constraints on local governments’ borrowing have hampered one of China’s traditional growth drivers.

Chinese urban unemployment stood at 5% in June. The leadership is targeting an unemployment rate of less than 5.5% over the next five-year period.

The slowdown in headline growth is unlikely to trigger a meaningful shift in Beijing’s policy stance in the coming months, said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, as the strong first quarter and resilient exports keep the economy on track for the government’s annual growth target.

— CNBC’s Evelyn Cheng contributed to the report.