Manufacturing powers ahead as PMI indicates 7th straight month of growth

Strong global demand for electronics - in particular, semiconductors - has given Singapore's manufacturing sector a shot in the arm.
Strong global demand for electronics - in particular, semiconductors - has given Singapore's manufacturing sector a shot in the arm. PHOTO: ST FILE

SINGAPORE - The manufacturing sector has been on a roll amid a more sanguine global outlook.

The latest sign that things are picking up came from the Purchasing Managers' Index (PMI) - an early indicator of manufacturing activity - which logged its seventh straight month of expansion in March.

The PMI came in at 51.2 last month, up from 50.9 in February. A reading of 50 and above indicates expansion.

This was also its highest reading since November 2014.

Strong global demand for electronics - in particular, semiconductors - has given Singapore's manufacturing sector a shot in the arm.

Factory output recorded another month of stronger-than-expected growth in February, expanding 12.6 per cent and beating economists' expectations of a 10 per cent rise.

March's PMI uptick was attributed to improvements in both domestic and export orders, as well as higher inventory and employment.

Manufacturing employment, which had previously been shrinking since November 2014, expanded for the third straight month in March.

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 survey also showed PMI for the electronics sector came in at 51.8 last month, up from 51.4 in February. This was the eighth consecutive month of expansion.

Separately, another survey of manufacturers in the region also showed operating conditions improving.

The Asean Manufacturing PMI came in at 50.9 in March - up from 50.3 in February - the second straight month of improvement.

The reading is based on original survey data collected from around 2,100 manufacturers by research company IHS Markit.

All Asean economies except Malaysia recorded growth in their manufacturing sectors. Vietnam was the strongest performer with its PMI reaching a 22-month high.

Growth in the Asean manufacturing industry was supported by stronger domestic demand as foreign demand remained weak, according to the data.