Singapore Manufacturing Activity Accelerates

By Gaurav Raghuvanshi Features Dow Jones Newswires

Singapore's manufacturing activity accelerated in October, with the local purchasing managers' index rising to its highest level in nearly eight years.

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The overall manufacturing PMI rose to 52.6 last month from 52.0 in September, the Singapore Institute of Purchasing & Materials Management said Thursday.

The PMI reading, which was the highest since December 2009, was the 14th consecutive reading above 50. A reading above 50 indicates expansion.

The institute said almost all indicators improved in October and the latest readings "continued to indicate sustained growth for the manufacturing economy since August last year."

The PMI for electronics, however, eased to 53.3 in October from 53.6 in September, the data showed.

The slower pace of expansion in the electronics sector was in line with analysts' expectations, as electronics factories in Singapore mostly make parts for mobile phones and computers. Major mobile phone makers have already launched their latest products, suggesting demand for components could continue to weaken, analysts said.

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The stronger PMI data, however, indicate that other segments of the economy strengthened.

Business expectations in the services sector improved, according to a government survey released on Wednesday.

The central bank, which last month kept its currency policy steady to give the economy more room to grow, said it expects some of the laggard sectors in the economy to fare better than in recent years.

An upturn in the global technology cycle fueled strong growth in Singapore's electronics production and exports this year. Electronics will remain strong, but the growth momentum will ease, the Monetary Authority of Singapore said in its second Macroeconomic Review report for 2017 released on Friday.

A broad swathe of average-performing industries are expected to fare better in the quarters ahead, though their growth will remain modest, the central bank said. These include the financial services, construction and marine sectors.

Write to Gaurav Raghuvanshi at gaurav.raghuvanshi@wsj.com

(END) Dow Jones Newswires

November 02, 2017 09:14 ET (13:14 GMT)