SINGAPORE (ICIS)--Singapore's manufacturing sector is poised to see further recovery this year as overall exports continue to grow amid an improvement in demand from its key external markets.
The Singapore Institute of Purchasing and Materials Management (SIPMM) Manufacturing Purchasing Managers’ Index (PMI) registered a smaller rate of expansion in February at 50.5, compared to 50.7 in the previous month.
A PMI reading above 50 indicates an expansion in the country's manufacturing economy.
SIPMMS’s February reading marks the eighth straight month of expansion, with exports and imports PMI remaining above 50 since the third quarter of last year.
“The improvement in Singapore’s exports especially will likely further lift manufacturing momentum into the year ahead,” said Barnabas Gan, an economist at Singapore-based UUB Global Economics & Markets Research.
The country’s overall non-oil domestic exports (NODX) rose by 12.8% year on year to S$15.1bn in January, accelerating from the 6.8% expansion in December 2020, Enterprise Singapore data showed.
“Notwithstanding the slowdown, PMI’s order backlog, which highlights the development of supply imbalances when new orders outstanding are accumulated, rose for its eighth straight month,” Gan said.
Separately, IHS Markit’s PMI for Singapore rose to a two-and-a-half year high in February at 54.9, supported by faster expansions in output and new orders, the financial information services provider said on Wednesday.
Business confidence in Singapore improved last month, with overall sentiment across Singapore’s private sector at the second-highest in any period since May 2019, it said.
“Anecdotal evidence suggested a combination of positive vaccine news and the complete easing of restrictions supported optimism during the month,” the firm added.
Focus article and interactive by Nurluqman Suratman