Singapore: According to the latest purchasing managers’ index (PMI), Singapore’s manufacturing activity dipped a notch in May, in line with economists’ expectation of a gradual slowing of the sector’s growth since last year’s high.
A further 0.2-point dip, based on the barometer of industrial activity, will see slower expansion of 52.7.
For 21 months consecutively, the sector has maintained in expansionary mode despite the recent slightly lower reading. While a reading above 50 indicates growth, below it illustrates contraction.
“While some signs of caution can still be felt to date, manufacturing momentum remains intact and is likely not facing a sharp moderation,” said Barnabas Gan, economist at OCBC.
Manufacturing constitutes one-fifth of Singapore economy, being one of its key growth driver.
Recent PMI has arisen from slower growth in factory output, marginally flatter growth in new orders, employment, exports, and inventory. A 52.3 reading was clocked on the indicator for stocks of finished goods—highest since February 2011. Order backlog metric was recorded at its lowest, 50.3 from June 2017.
PMI of the electronic sector conversely inched up by 0.1 point, to a record reading of 52.3—the 22nd month of improved conditions.
The PMI was released shortly after a separate factory output data for April, indicating 9.1 percent of accelerated growth in industrial production.
Mixed PMI performances were recorded throughout the Asia Pacific region, seeing neutral or softer readings in China, India, Malaysia, South Korea and Taiwan. Economies with strengthened manufacturing conditions include Japan, the Philippines, Thailand and Vietnam.