Singapore's manufacturing held up well last month, despite a fall in biomedical output.
Singapore's factory output rises 5.3% in Aug from a year ago
Singapore's manufacturers produced 5.3 percent more goods in August compared with a year ago, says the Economic Development Board on Monday. It was well below market expectations for a 7.4 percent rise.
The growth pace slowed sharply from July's 19.1 percent on-year rise as the production of drugs and other biomedical products plunged. On a seasonally adjusted month-on-month basis, manufacturing output last month fell 1.1 percent, compared with a revised gain of 2.6 percent in July.
Excluding the biomedical sector, whose output can swing sharply from month to month, Singapore's industrial production index rose 20.2 percent from a year ago compared with a rise of 18.6 percent in July. This has led economists to conclude that the underlying growth momentum in manufacturing remains intact, and that the economy is on track for 8 to 9 percent growth this year.
Last Friday, the US Commerce Department had reported that US durable goods orders were down 0.5 percent in August but, excluding transportation equipment, were up 2.3 percent. Yesterday, the Commerce Department reported that sales of new homes rose 9.4 percent in August.
These figures indicate that the US economy may be "regaining traction" after all. Normally, that would augur well for production in Asia -- including Singapore -- in the months ahead.
However, with NYMEX crude oil surging past US$50 a barrel to a new record today, oil prices will be a major headwind to economic growth.