Singapore factory activity expands for second straight month in October

Employees at a printed circuit board assembly factory in Singapore. The country's factory output grew for the second straight month in October.
Employees at a printed circuit board assembly factory in Singapore. The country's factory output grew for the second straight month in October.PHOTO: REUTERS

SINGAPORE - Singapore's manufacturing sector appears to be showing nascent signs of recovery after a long period stuck in the doldrums.

Factory output grew for the second straight month in October, after more than a year of contraction.

However, economists cautioned that the outlook remains wobbly and that tough times might still lie ahead, given weak global economic sentiment.

Singapore's Purchasing Managers' Index (PMI) - an early indicator of manufacturing activity - came in at 50 last month, down slightly from 50.1 in September. A reading of 50 and above indicates expansion.

 

Before September's uptick, the PMI had previously been shrinking since June last year.

The slightly weaker reading recorded in October was attributed to slower overall factory output and lower employment, though domestic and export orders logged marginal improvements.

Manufacturing employment, which has been shrinking since November 2014, remained lacklustre.

The data was compiled by the Singapore Institute of Purchasing and Materials Management from a monthly poll of purchasing executives at about 150 industrial firms.

The October PMI survey also showed that the PMI for the electronics sector came in at 50.8 in October - up from 50.3 in September, and the third straight month of expansion.

A recent Economic Development Board poll of manufacturers found that the electronics cluster is the most optimistic about the October to March period, due largely to a seasonal pick-up in demand for semiconductor chips.

Elsewhere in the world, manufacturing gained pace in the United States, European Union, Japan and China.

In particular, China's October factory activity expanded at the fastest pace in over two years. The official PMI stood at 51.2 in October, much stronger than September and the highest reading since July 2014.