Illustrative photo (Photo: Xinhua/VNA) Singapore (VNA) – Singapore’s factory activity grewfor the first time in six months, signalling that the slump in manufacturingmay have bottomed out, even as the electronics industry continued to showcontraction, according to the Singapore Institute of Purchasing and MaterialsManagement.
The Purchasing Managers’ index (PMI), a barometer of themanufacturing sector, nudged higher to 50.1 points in September, up from 49.9points in the previous month.
An PMI below 50 indicates contraction, whereas those above 50points denote growth. This expansion was helped by the broad-based improvement,albeit a marginal one, across a raft of key indicators such as new exports,imports, output, inventory and order backlog, and particularly the increase ofthe employment index after a 7-month contraction.
However, according to some experts, headwinds in Singapore’smanufacturing sector remain, given the weak external demand that could persistfor the rest of 2023, exacerbated by tight financial conditions stemming froman elevated interest rate environment.
Besides the high-interest rates in advanced economies, China’spost-pandemic bumpy recovery and lingering geopolitical tensions couldstill disrupt supply chains.
For the electronics segment, the latest PMI data pointed to afurther shrinkage, despite improving by 0.3 points to 49.8 from a monthearlier.
Meanwhile, the increase in input prices may be due to the recentincrease in global crude oil prices because Russia and Saudi Arabia announcedproduction cuts, which also had a significant impact on Singapore's productionactivities.
Economic experts expect a gradual recovery in Singapore'smanufacturing sector in the final months of the year, an improvement in theorder backlog generally denotes brightening prospects for the sector. Supplyand demand are gradually balanced, creating a premise for the country'sproduction growth in the coming year./.
