Growth slows for Singapore firms in private sector: Nikkei PMI

Operating conditions faced by Singapore private sector companies improved in February, but at the slowest pace in four months.
Operating conditions faced by Singapore private sector companies improved in February, but at the slowest pace in four months. PHOTO: REUTERS

SINGAPORE - Operating conditions faced by Singapore private sector companies improved in February, but at the slowest pace in four months.

The headline Nikkei purchasing managers' index (PMI) for the private sector fell to 51.6 in February, down from 52.5 in January. Any reading above 50.0 signals expansion.

Output expanded at the weakest rate since October 2013, as total new work rose only marginally, the Nikkei PMI showed.

On Wednesday, the PMI covering only manufacturing showed that factory activity in Singapore contracted for an eighth straight month, with production, new orders and employment all falling in February.

The Nikkei Singapore PMI is based on data compiled from monthly replies to questionnaires sent to executives in more than 400 private sector companies, selected to represent the structure of Singapore's economy, including manufacturing, services, construction and retail.

Its latest reading indicated only a modest improvement in the local private sector in February.

Annabel Fiddes, economist at Markit, said: "The pace of output growth weakened to 28-month low and new order books expanded only slightly."

New export work rose at a much slower pace than that seen at the start of the year, and subdued market conditions fed through to modest employment growth across the sector, she added.

"Unless demand picks up, both at home and abroad, it seems likely that growth momentum will weaken further in the coming months," she said.

jkoh@sph.com.sg