Singapore’s factory output experienced a resurgence in July, marking a 1.8% year-on-year increase, according to the latest data from the Economic Development Board (EDB). This rebound follows a revised 4.3% decline in June and surpassed the median forecast of 0.2% growth predicted by private-sector economists in a Bloomberg poll.
The recovery in industrial production was largely driven by significant gains in several key sectors. The basic metals production sector saw a turnaround with a 1.7% year-on-year growth, a stark contrast to the 32% decline observed in June. Similarly, the computer, electronics, and optical products sector improved, recording a 2% increase after a 6.5% drop the previous month. Electrical equipment production also saw a sharp rise of 16.7%, reversing the 5.8% decrease noted in June.
However, MIDF noted that the biomedical manufacturing sector continued to face challenges, with output falling by 17.4% year-on-year, maintaining the downward trend from June’s 22.3% decline.
On a month-over-month basis, adjusted for seasonality, manufacturing output surged by 10.1%, indicating a rapid recovery within the sector. This was particularly evident in basic metals production, which saw an impressive 30.7% month-on-month increase, likely driven by the fulfilment of pent-up demand.
The broking house said the positive performance in Singapore’s Industrial Production Index (IPI) aligns with the improved manufacturing Purchasing Managers’ Index (PMI) reading in July. Given the encouraging IPI results, it is expected that the regional trade of manufactured goods will continue to pick up in the second half of 2024, supported by the recovery in the electrical and electronics (E&E) trade.
