Singapore's manufacturing resurgence continued for the ninth straight month last month with another forecast-beating effort.
Factory output grew 6.7 per cent last month from a year earlier, as star performer electronics - especially semiconductors - extended the sector's winning streak.
Manufacturing - making up one- fifth of the economy - was led by a 48 per cent jump in electronics output year on year.
The semiconductors segment rose 69.1 per cent, the Economic Development Board (EDB) said yesterday.
"The electronics cluster is booming - with the semiconductor segment now entering its 14th consecutive month of double-digit expansion - and recording the highest level of production to date in April," Maybank Kim Eng economist Chua Hak Bin noted. Except for data storage, he said, computer peripherals, consumer electronics and other electronic modules all grew at a faster pace than in March.
Precision engineering remains a bright spot, jumping 15.7 per cent as machinery and systems output benefited from higher semiconductor demand, Mr Chua said.
Still, last month's factory output growth was slower than the 11 per cent in March, fuelling a belief that manufacturing activity may have moderated from a first-quarter peak.
ANZ Research economist Ng Weiwen said industrial production has been "firing on a single engine".
"The strength of manufacturing output has been narrowly focused on electronics, particularly semiconductors, while the other manufacturing clusters registered either a slower pace of growth or contracted," he said.
The tech cluster has been instrumental in the manufacturing rally so far, but there are concerns about consumer demand waning towards the latter part of the year, said DBS senior economist Irvin Seah.
"Tighter credit conditions and stiffer regulations on the property market in China could weigh on consumer sentiments and indirectly on Singapore's electronics components exports. A difficult Brexit process could be another risk factor," he warned.
Transport engineering output fell 14.5 per cent last month, as marine and offshore engineering extended its decline by 30.5 per cent. "The marine and offshore engineering segment remained weak with a low level of rig-building activity and lacklustre demand for oilfield and gasfield equipment," said the EDB.
The volatile biomedical cluster was the worst performer, shrinking 23.3 per cent, as pharmaceuticals plunged 32.4 per cent. But medical technology bucked the trend, jumping 11.1 per cent on higher exports of medical devices.
Excluding biomedical production, overall factory output grew 15.5 per cent year on year. On a month-on-month basis, it grew by 5.4 per cent from March.
United Overseas Bank economist Francis Tan warned of headwinds and uncertainties due to the upcoming elections in several European countries, as these may fuel further populist, anti-trade sentiments. "Policy surprises from the United States administration could further constrain discretionary consumption and business investment," he said.