FACTORY activity here turned slightly sluggish in March from the previous month as new orders and production levels dipped, much in line with other key Asian economies such as China and India.

The Singapore Purchasing Managers' Index (PMI) dipped from 50.9 in February to 50.8 in March, below the 51.1 level which economists were expecting. A reading above 50 indicates growth.

Although the reading was mildly weaker, Ms Janice Ong, executive director of the Singapore Institute of Purchasing and Materials Management, which compiles the PMI, said it shows the sector "still remains on the expansion track, reflecting the continuing positive business environment".

The experts say the main highlight is the electronics PMI's improvement from 51.2 in February to 51.6 last month, meaning this sector has continued to expand for the 14th straight month.

The upbeat reading also suggests that the growth momentum for the local electronics industry should be sustained into the second quarter, economists say.

"Our anecdotal evidences suggested that many companies were faced with a relatively strong global demand for electronics components from key foreign markets," said Ms Ong.