SINGAPORE’S factory output continued its downward trajectory in August, coming in below economist expectations as the impact of Sino-US trade conflict, slowing demand from China, and high base effects kick in.
Industrial production grew by 3.3 per cent year on year last month, compared to 6.7 per cent in July, and 8.1 per cent in June. This also underwhelmed economist expectations of a 4.7 per cent expansion in August.
If the volatile biomedical manufacturing cluster was stripped out, output would have grown 3 per cent.
On a seasonally adjusted month-on-month basis, manufacturing output actually declined 2 per cent. Without biomedical manufacturing, production fell 3.4 per cent.
Electronics, which was the star performer driving Singapore’s economic growth last year, grew a muted 3.6 per cent in August on a year-on-year basis. This was mainly attributed to the other electronic modules & components and semiconductors segments, which grew 19.4 per cent and 7.8 per cent respectively. The rest of the electronics segments recorded output declines.
Instead, it was the chemicals cluster which led growth in August, with an increase of 5.7 per cent compared to a year ago thanks to the specialities segment, which grew 14.2 per cent due to the low base last year as a result of plant maintenance shutdown.
Precision engineering also clocked solid growth with an output expansion of 5.6 per cent last month. This was buoyed by the precision modules & components segment which expanded 16.5 per cent, on account of higher production in optical instruments.
Output in the transport engineering sector was up 4.7 per cent in August. Within the cluster, the marine & offshore engineering segment shot up 15.4 per cent, on the back of a higher level of work done in offshore projects.
As for the volatile biomedical manufacturing cluster, it grew 4.2 per cent last month. This was pushed up by pharmaceuticals output which expanded 8.7 per cent with higher production of pharmaceutical and biological products, while the medical technology segment fell 8.2 per cent.
General manufacturing was the only cluster to shrink in August, falling 6 per cent on a year-on-year basis in the month, with all segments recording declines. The food, beverages & tobacco segment contracted 5.3 per cent, on account of lower production of infant milk and beverage products. The miscellaneous industries and printing segment declined 5.7 per cent and 9.9 per cent respectively.