Singaporean manufacturing and electronics PMI indices rise in October

Singaporean manufacturing and electronics PMI indices rebounded further in the month of October. The manufacturing PMI index rose 0.2 points to 50.5, while the electronics PMI index rose 0.1 points to 51. These marked the fourth and third straight months of growth and also the highest since March 2019 and September 2018, respectively. This implies that the recovery story is likely to sustain past the third quarter, noted Selena Ling, Head of Treasury Research and Strategy, OCBC Bank.

Markedly, the rebound was mainly due to new orders, new export orders, and factory output. The hiring picture is also rebounding, albeit slowly, from 48.8 to 49.2 for the overall manufacturing sector and from 49.6 to 49.8 for the electronics sector, although both have spent nine straight months in contraction territory. This is an affirmation that the manufacturing, especially the electronics, sector continues to be in the driver’s seat for the Singaporean economy and will likely outperform the services and construction sectors for 2020.

“Our forecast is for the manufacturing sector to expand 5.6 percent yoy this year before moderating to 3.1 percent yoy in 2021”, stated Selena Ling.