Jan 4, 2013

Singapore - Singapore PMI shrinks for 6th month, orders fall

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SINGAPORE - Manufacturing activity in Singapore contracted for a sixth consecutive month in December, bucking the improvement seen in many other countries, as orders fell further, an industry survey showed.

The city-state's Purchasing Manager's index (PMI) dipped to 48.6 points last month from 48.8 points in November, hurt by further declines in the sub-indexes for new orders and new export orders, the Singapore Institute of Purchasing & Materials Management (SIPMM) said on Thursday.

A PMI reading below 50 shows activity is contracting.

"The contraction in the overall PMI was attributed to further declines in new orders, new export orders and production output. Inventory continued to expand for the third consecutive month whilst stockholdings of finished goods, imports and employment continued to contract," SIPMM said in a statement.

A separate PMI for Singapore's electronics sector showed activity weakened to 46.6 in December from 47.4 in November.

Singapore, whose trade is around three times GDP, has been badly hit by the weakness in Western economies that has crimped demand for many of its exports. Its electronics manufacturers have also failed to tap surging demand for smartphones, unlike rivals in South Korea and Taiwan.

According to advance GDP numbers released on Wednesday, Singapore's manufacturing sector shrank 10.8 percent sequentially in the fourth quarter on an annualised and seasonally adjusted basis, worsening from the 9.9 percent contraction in the third quarter.

The weakness in its manufacturing sector contrasts with Taiwan and South Korea, which both reported stronger PMI numbers on Wednesday.

HSBC, which compiles many of the Asian PMIs, said on Wednesday its headline Asian electronics lead indicator rose in December to hit its highest reading since March 2012.


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