Factory production, which accounts for about a quarter of economic output, plunged 33.9 per cent last month compared to the same month a year earlier, according to data released by the Economic Development Board (EDB) on Friday.

It was dragged down by the drugs cluster, which shrivelled 55 per cent last month due to a different mix of pharmaceutical products. Electronics did little better, declining 35 per cent on weak global demand.

The March numbers were significantly worse than February's drop of 15.1 per cent and beat even the previous record - January's plunge of 27.6 per cent. On the bright side, however, both January's and February's numbers were revised upwards from their initial estimates.

These higher revisions led to slightly better numbers for manufacturing in the first quarter than previously predicted. The sector shrank 26.1 per cent in the first three months of the year, less than the 29 per cent decline that the Government had estimated earlier this month.

On the strength of this, Citigroup economist Kit Wei Zheng thinks the abysmal growth estimate for the first quarter could also be revised upwards.

The Government said earlier this month that the economy shrank a record 11.5 per cent in the first three months of the year. With better-than-predicted manufacturing numbers for January and February now in, this could be improved to a 10.7 per cent decline, said Mr Kit.

On a month-on-month basis, which is a better indicator of the recent trend, manufacturing contracted 13.9 per cent last month over February. This was a sharp reversal from the previous month, when the sector actually grew 3.5 per cent in February over January.

The worse-than-expected fall in March manufacturing marked the sixth monthly decline in a row.

Read the full story in Saturday's edition of The Straits Times.